China intends to expand its pilot reform of the real estate tax, which has not yet materialized due to several reservations, as the government battles speculation in the real estate sector.
According to Al Arabiya Net, the official China News Agency reported, a standing committee in the People's Assembly of China, the country's highest legislature, approved on Saturday the latest plan to Promote rational housing consumption.
As part of this five-year pilot project, property tax will be levied on all types of real estate except for private cottages.
The project launch date and target areas will be determined at a later time.
The real estate market, the engine of China's growth over the past two decades, has thrived after major reforms in 1998, which led to a construction boom in the context of rapid urbanization and wealth accumulation. .
But rising prices raise concerns about wealth inequality and risks from social instability.
The announcement comes at a time when Chinese President Xi Jinping is calling for greater shared prosperity in China through a more equitable distribution of wealth.
The real estate tax has been in the works for years in Shanghai (east) and Chongqing (southwest). But its generalization in the country, something that has been talked about since 2000 years, has never been implemented.
One of the main reasons for this is that this tax will be bad for owners who are already tired of paying for their properties, and it may lead to lower demand or even to the purchase of a large number of apartments.
The start of the reform comes at a time when the prices of new homes in China have fallen for the first time in six years, amid a feeling of skepticism among buyers in the face of the bankruptcy of a large number of investors. .
House values fell 16.9% in September year-on-year.
But some analysts consider this tax measure to be aimed at preventing prices from rising to their previous levels.
