China property tax based on ‘appraisal value’, with legal process to be in place by 2019
Policy statement in People’s Daily story on Wednesday offers strong hint long-delayed, much-debated property reform is gaining momentum, say analysts
China’s new residential properties tax will be based on “appraisal value”, Finance Minister Xiao Jie confirmed in an article published by the communist party’s flagship newspaper, suggesting the top leadership has finally reached initial consensus, which should see an acceleration of its introduction.
However, apart from suggesting all legislative procedures will be completed by 2019, many of the finer details still remain unclear, in what has become one of the most contentious issues among residents.
“Existing industrial and commercial properties, as well as individual houses, will be taxed on the basis of an appraisal value, while current taxes on new builds will be lowered,” Xiao said in an article published in the People’s Daily on Wednesday.
China currently only taxes individuals when they buy or sell property, and the introduction of a new property tax has become a highly contentious issue.
It shows the top leadership is forming a clear vision on property taxes. It touches on the specific questions of how tax will actually be collected, and is a signal that property tax reform is gaining pace
The minister first revealed the likely residential properties tax will be based on appraisal values in October, in an official pamphlet that highlighted top officials’ speeches and an interpretation of President Xi Jinping’s main policy address, in a wrap-up of the 19th Party Congress in Beijing.