HONG Kong property developers working on the mainland have had to postpone their listing plans because of the newly introduced capital gains tax, said Ernst and Young partner Conway Lee.
Mr Lee said he knew of several developers working on projects in China who had been caught off guard by the capital gains tax which was introduced last December and came into effect from the beginning of this year.
The tax, which is supposed to replace the land appreciation tax, has not yet been implemented because there is confusion on how to apply the tax.
Mr Lee said Hong Kong developers had not budgeted for the tax and so their profits would be adversely affected.
Until the situation was cleared and proper estimates of budgets could be made, those developers could not proceed with their listing plans.
''Hong Kong property developers have definitely had their plans put on hold. I know of one developer who wants to raise $100 million through a new listing but now has to wait,'' he said.
