SHANGHAI—Shanghai's mayor on Friday said the city will impose a controversial tax on property, a move by China's richest city that may be rolled out nationally as authorities scout for new ways to cool housing prices.
The country has one the most expensive real-estate markets anywhere relative to the income of its citizens. Global Property Guide, a Manila-based consultancy, says a square meter of property stands at 164 times China's per capita income, compared with 33 times in high-priced Japan.
No mention of the details of how the tax will work.
Plans for the tax are also emerging as Chinese cities sit on enormous, but largely hidden, deficits. In Shanghai, which last year funded a lavish World's Fair, the Shanghai Expo 2010, but hasn't broken down the costs and is now developing a Walt Disney Co. theme park, Mr. Han pledged to make more government accounts public over the coming year. He said the city also hopes to lead China in implementing a value-added tax on the services industry.
Added: the only real upside to the tax is it will give munis an income stream besides selling land to developers, taking the government, if only a little, out of the developers' pockets.