According to state-run Xinhua news agency, China’s Finance Ministry said on March 16 that the country would postpone expanding its trial on property taxes.
“Considering all aspects of the situation, there are no suitable conditions to pilot the property tax reform in more cities this year,” China’s Finance Ministry was cited as saying, adding that the decision was reached following the preliminary investigation in a few towns.
Reuters’ calculations based on the National Bureau of Statistics data showed that new house prices remained flat in February after increasing a month earlier. In particular, average new house prices in China’s 70 main cities stayed unchanged, compared to a 0.1% rise in January.
In 2011, China initiated a property tax pilot scheme in Shanghai and Chongquing. However, stakeholders, including local governments relying heavily on land sales as a source of financing, had resisted the concept of launching a new trial.
In October last year, China Parliament’s top decision-making body said a trial of the real estate tax would be implemented in select areas but did not specify which areas or provide any other information.
For the third consecutive year, China’s annual Assembly of Parliament removed a potential property tax from its legislative plan for 2022.