Wednesday, January 12, 2011

Chongqing Readying Property Tax (update)

Details are slim. The tax may take effect the end of March and may be 1% and only on new properties. If true, that will not generate enough revenue to get the municipality to be less beholden to real estate development for income.

China City Set to Tax Residential Real Estate
How significant the planned taxes will be in practice remains unclear. Little information about the planned tax in Chongqing has been disclosed, such as at what value the tax will start to be assessed, exactly how the value will be determined, and what the tax rate will be. China lacks accurate data on house ownership, and enforcement of tax collection tends to be lax. Xinhua said the Chongqing municipal government "is rushing to draft a detailed regulation" for the tax. The report provided no further details.

China's Chongqing To Collect Real-Estate Tax On All High-End Homes - Mayor
BEIJING (Dow Jones)--China's southwestern Chongqing city plans to levy a real-estate tax on both existing and new high-end residential properties, Mayor Huang Qifan said Wednesday on state television.

High-end homes are defined as properties that are more than three times the average price in the city, state television reported, citing Huang. It didn't provide further details on the tax


jesse said...

No surprises. Local governments are trying every trick on the book to keep the punch bowl serving for as long as possible.

The Politburo is going to have to pretty much start shooting local councils before they enact a tax that will actually have some effect.

GG said...

The new laws to return property to the government if it hasn't been developed in two years feeds into this too. Without property sales there will be a sharp drop off in local government funding.