Tang stood as a candidate for the Workers' Party in Cheng San the Group Representation Constituency at the 1997 general election. The party's team in the constituency also included the party's leader, former Member of Parliament J.B. Jeyaretnam. During the election campaign, Prime MinisterGoh Chok Tong accused Tang of being a Chinese chauvinist because of comments Tang had made at other public events in the past. Goh stated that he was therefore making himself "a special candidate" in Cheng San GRC because he felt that Tang must be kept out of Parliament if Singapore's inter-racial harmony was to be protected. Tang insisted that all he had ever tried to do was to "better represent the Chinese community and ask questions on their behalf". He vigorously denied that he was a Chinese chauvinist and accused the PAP of trying to win votes by sowing fear into the electorate. Tang also came under fire from the PAP after he raised the issue of the Hotel Properties Ltd case during the election campaign. This issue arose after the Stock Exchange of Singapore had previously criticised Hotel Properties Ltd for its "tardiness" in disclosing details of sales of its condominium units to directors and their family members. Former Prime Minister Lee Kuan Yew, who had purchased one of the units and whose brother was a director of Hotel Properties Ltd, claimed that Tang was trying to smear his name and milk this issue for political capital. On election day, the Worker's Party's team in Cheng San GRC lost to the PAP's team by 44,132 votes to 53,553. This was the highest percentage of the vote garnered by any opposition losing candidates, and was therefore enough to secure one of the team's members a seat as a Non-Constituency Member of Parliament. The party selected Jeyaretnam to become its NCMP.
Post-election legal action
After the election, Tang was sued for defamation by eleven PAP politicians, including Goh, Lee and Deputy Prime MinistersLee Hsien Loong and Tony Tan, who accused him of making statements during the campaign which falsely questioned their integrity. A total of 13 judgements were entered against Tang for defamation. Tang also subsequently faced charges from the Inland Revenue Department for evading taxes. Tang left Singapore for Johor, Malaysia, shortly after the election. His wife's passport was then impounded but later released. Eventually Tang found refuge in Australia, where he was reunited with his wife. After Tang left Singapore, the plaintiffs in the lawsuits obtained the Mareva injunction against him to restrain him from disposing of assets and to require him to disclose the whereabouts of his assets. When Tang failed to file an affidavit disclosing his assets, the plaintiffs obtained default judgements against Tang in all their suits. Damages were assessed by a judge of the High Court at a total of S$ 8,075,000. Tang's appeals against the default judgements were argued by the British Queen's CounselCharles Gray before the Court of Appeal in September 1997, but was unsuccessful. Tang has not returned to Singapore since 1997 and continues to live in Australia.