Central bank advisor: 1% property tax too high

16:33, January 11, 2011      

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A property tax of 1 percent is too high, and it is unrealistic to control housing prices via property tax, said China's central bank advisor Li Daokui.

Chongqing is likely to launch a trial property tax in the first quarter, according to the Xinhua report yesterday. The city will impose a 1 percent tax on properties priced at three times the average for Chongqing.

"Property taxes in other countries are generally set to around 0.5 to 0.8 percent, and the government will provide public services following the taxation," said Li, adding that it was unrealistic to pin the hopes to lower housing prices on property tax.

Today's China Securities Journal quoted Mayor Huang Qifan, who said that the city will implement property tax targeting hi-end properties. The Ministry of Finance has nodded approval for the plan.

Home prices in Chongqing rose 29.4 percent last year from 2009 and gained 1.1 percent in December from November, the country's biggest real estate website Soufun.com said earlier this month.

By People's Daily Online
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