Property tax plan vague despite pledge
Source: Xinhua |
July 18, 2013, Thursday
|
Print Edition
Print Edition
THE long-discussed expansion of China's property tax plan has once again come under the spotlight following a renewed pledge by tax authorities to research the plan.
The State Administration of Taxation said in a circular issued late on Tuesday it will research the possible expansion of property tax pilot programs.
However, like similar statements previously made by other authorities, the circular did not include any details regarding a timetable for the expansion.
The comment is the latest in a string of official statements in which authorities have vowed to implement a property tax plan currently being used in the cities of Shanghai and Chongqing.
The government, however, has yet to make any substantial moves regarding the tax, although recent reports indicate that several cities, including Hangzhou and Wuhan, are ready to implement the plan.
"The stagnation suggests that multiple factors are holding the expansion back," said Chen Guoqiang, vice president of the China Real Estate Society, citing reluctance from local governments and other interest groups as the major reasons.
The government introduced property taxes in Chongqing and Shanghai on a trial basis in 2010 as part of efforts to cool the rampant property market.
The Chongqing trial focused on taxing high-end housing, while Shanghai's program mainly targeted the ownership of multiple houses. But due to limited rates that ranged from 0.5 to 1.2 percent, the taxes imposed were seen as too low to be effective in keeping local housing prices in check.
But analysts believe the property tax plan will be expanded, as the government sees it as a tool that can be used to regulate the market in the long term.
The State Administration of Taxation said in a circular issued late on Tuesday it will research the possible expansion of property tax pilot programs.
However, like similar statements previously made by other authorities, the circular did not include any details regarding a timetable for the expansion.
The comment is the latest in a string of official statements in which authorities have vowed to implement a property tax plan currently being used in the cities of Shanghai and Chongqing.
The government, however, has yet to make any substantial moves regarding the tax, although recent reports indicate that several cities, including Hangzhou and Wuhan, are ready to implement the plan.
"The stagnation suggests that multiple factors are holding the expansion back," said Chen Guoqiang, vice president of the China Real Estate Society, citing reluctance from local governments and other interest groups as the major reasons.
The government introduced property taxes in Chongqing and Shanghai on a trial basis in 2010 as part of efforts to cool the rampant property market.
The Chongqing trial focused on taxing high-end housing, while Shanghai's program mainly targeted the ownership of multiple houses. But due to limited rates that ranged from 0.5 to 1.2 percent, the taxes imposed were seen as too low to be effective in keeping local housing prices in check.
But analysts believe the property tax plan will be expanded, as the government sees it as a tool that can be used to regulate the market in the long term.
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