CRI听力:Property Tax Policy to be Extended

Citing an unnamed source from the State Administration of Taxation, a report on the website of the Ministry of Land and Resources said the expansion of the central government's property tax policy to Hunan and Hubei provinces was being finalized. The report did not say when the policy would be implemented.

Second homes and additional property purchased in Hunan and Hubei provinces will be subject to a tax, although the amount is not expected to be high. The tax will be based on the market value of the property rather than its original value.

Until now, the pilot property tax policy has only been implemented in Shanghai and Chongqing. The tax amount in those cities is based on the original value of a property. Some homeowners and prospective homebuyers say they do not believe levying a property tax will be an effective way to curb housing prices. Here is a citizen in Guangzhou city.

"I don't think the property tax policy will work. For example, if I'm required to pay property tax when buying an apartment, I'll tag the property at a higher price when I resell it. Then the price of secondhand homes will probably increase."

But many experts say implementing property taxes will help regulate the income of high-income groups through taxation and help curb speculative home purchases as buyers must take the tax into account before making a purchase. That is to say, the property tax reform will serve as a real estate market stabilizer, helping to curb asset bubble risks, although the pace is rather slow, and the scope is still small.

They say this can be done by expanding the number of cities involved in the property tax trial policy by carefully including the necessary real estate categories that are subject to the tax.

Some experts say in addition to its important role in reducing market bubbles, the property tax will also bring in substantial revenue for local governments suffering financial difficulties.

Financial and economic expert Shui Pi says he believes that the property tax will be implemented around the country.

"Before an obvious drop in property prices is seen, all the control measures are considered feasible, including the property tax policy. However, even when the property tax policy is implemented, it's impossible that it will have a real impact on the real estate market. It can only increase tax revenue. I think the property tax will be implemented nationwide."

The central government introduced property tax trial policies in Shanghai and Chongqing at the beginning of the year as part of its efforts to curb skyrocketing home prices and contain asset bubbles.

Analysts say the country may accelerate the introduction of property tax nationwide to help capital-starved local governments increase their revenue and pay off debt.

For CRI, I am Zhang Wan.