[转贴] China to Speed Introduction of Trial Property Tax to Curb Real Estate Boom

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Sept. 29 (Bloomberg) -- China will speed up the introduction of a trial property tax in some cities and then expand the levy to the whole country to curb rising real estate prices, the government said, without giving a timetable.

The state also asked commercial banks to stop offering loans to buyers of third homes and extended a 30 percent down payment requirement to all first-home buyers, according to a statement posted on the government website. The down payment level previously applied only to homes larger than 90 square meters (969 square feet).

Property prices in 70 major cities rose 9.3 percent in August from a year earlier, prompting the government to extend a crackdown on speculators and multiple home purchases. The state may implement the property tax soon in cities including Shanghai, Shenzhen and Chongqing, according to Credit Suisse Group AG.

“The new measures are not dramatic, but they convey a clear policy message: Beijing is serious about controlling the property prices,” Qu Hongbin, a Hong Kong-based economist with HSBC Holdings Plc, said in e-mailed comments today. “This should help damp the expectations” that housing prices will rise quickly, Qu said.

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China will halve the transaction tax for buyers of non- luxury homes for use as sole residences starting Oct. 1, the Finance Ministry said in statement on its website today. The rate will be 1 percent for units of 90 square meters or smaller, it said.

Exemption Ends

The country will also end an income-tax exemption on profits from the sale of real estate reinvested within one year, the ministry said.

Banks will be ordered to stop lending to property developers that violate industry regulations, the government said earlier today.

Credit Suisse analysts led by Jinsong Du recommended “reducing exposure” to Chinese property stocks in the near term, saying a tax would hurt real-estate market sentiment, according to a note to clients dated yesterday.

China may announce property taxes as early as the October National Day holidays, China Business News reported Sept. 21, citing an unidentified person. The break runs Oct. 1 to Oct. 7.

The trial measure, which extends the existing commercial property tax to homes, is more likely to be implemented at the start of next year, the Chinese-language newspaper said.

China has since April raised the down payment and interest rates on second-home mortgages and restricted the number of new homes residents can buy in some cities.

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