Property tycoon Ren Zhiqiang slams CCTV as 'the dumbest pig on earth'

Ren published his blunt analogy after CCTV accused China Vanke of owing more than 4.4 billion yuan in tax

PUBLISHED : Friday, 03 January, 2014, 12:08pm
UPDATED : Monday, 06 January, 2014, 3:01pm

Property tycoon Ren Zhiqiang, an influential microblogger with more than 16 million followers on his Chinese Weibo, slammed China's state broadcaster in a recent post as "the dumbest pig on earth".

Ren published his blunt analogy after CCTV, in a programme aired last week, accused China Vanke, the country's largest homebuilder by sales, of owing more than 4.4 billion yuan in unpaid land appreciation tax (LAT) as of 2012. LAT is a levy that was introduced in 1994 by the government on profits realised from the transfer of property.

Ren, chairman of Beijing-based Hua Yuan Real Estate Group, said he had found the report a far cry from the true picture.

"I couldn't tell from CCTV's report whether Vanke indeed owed taxes, since CCTV didn't produce any evidence that those new developments failed to pay," he wrote on Weibo, "Why didn't CCTV interview any accountants? Why didn't they talk to the Securities Regulatory Commission?" 

"You can't find a pig dumber than CCTV on the whole earth," a furious Ren added.

Vanke, a Shenzhen-listed company, has dismissed the allegations as untrue. It claimed to have paid 62 billion yuan in taxes from 2010 to 2012 when they only netted less than 29.4 billion yuan in taxes over these three years, according to Chinese media reports. 

Johnson Hu, a Hong Kong-based property analyst at CIMB-GK, told the South China Morning Post on Friday that CCTV might have based its report on unrealistic assumptions of the profit margin of China's real estate developers.

Contrary to popular perceptions people hold of developers, Hu said the largest portion of the profit "pie" in the property business is usually grabbed by local governments. Developers, while still making money, are slapped with heavy taxes.

In the past, Chinese developers would sometimes negotiate with local tax authorities over tax reductions as an incentive for them to contribute to the local economy. But Hu said the room for "negotiation" might shrink in the future as the government tries to rein in soaring home prices. 

Ren, an outspoken and prolific microblogger, has harbored a public animosity toward CCTV. He threatened to sue the state broadcaster in November after it alleged his company owed 54.9 billion yuan in unpaid tax.

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