Will China’s property tax rob from the rich and give to the poor, aiding common prosperity drive?
- China’s property tax plan is part of Xi Jinping’s so-called common prosperity campaign to redistribute wealth and to address widening social inequality
- The plan will not be implemented straight away, with a five year pilot programme set to test the proposal before it is eventually rolled out across the country
On the fourth Friday of every month, 30-year-old Ding Xunan makes a nearly 20-hour train journey of over 1,700km from Shenzhen in southern China to Pingdingshan, a prefecture-level city in the central Chinese province of Henan to reunite with his new wife.
The newlyweds are unable to afford the property prices in the big urban cities, so in 2019, car factory worker Ding bought a flat in his wife’s hometown – a medium-sized city of around 4 million people in the hinterland province in central China’s Yellow River Valley.
I’ve already spent almost all my own and my parents’ savings on getting married, including the cost of the wedding and housing, but I still have a brother who needs to get married in the future
“I made a down payment of about 460,000 yuan (US$72,000), and will have to pay back the mortgage by more than 3,600 yuan (US$564) a month for the next 25 years,” Ding said.
“The prices were very high back then, about 8,000 yuan a square metre, and now there are very many communities nearby at around 6,000 and 7,000 yuan a square metre.
“Property prices are starting to drop in growing third, fourth and fifth-tier cities, but I feel relieved. I’ve already spent almost all my own and my parents’ savings on getting married, including the cost of the wedding and housing, but I still have a brother who needs to get married in the future.”