Analysts expect China’s long-awaited property tax to be submitted as early as before the end of 2018 following its inclusion in the legislative schedule for the Standing Committee of the National People’s Congress.
The Standing Committee of the 13th NPC just publicly released its latest legislative schedule, which includes the property tax as one of 69 “first category items” (第一类项目) for consideration over the next five years.
The inclusion means that plans for the submission and consideration of a draft bill are in place, with the NPC’s budget work committee and the Ministry of Finance expected to lead drafting of new legislation.
The move marks the eighth time since the start of 2018 that the Chinese central government has made reference to a property tax, after Premier Li Keqiang said that property tax legislation needed to be advanced on 5 March.
Policymakers hope that the long-awaited property tax will help to contain China’s urban real estate markets as well as provide are a more solid and reliable source of revenue for local governments, by placing a levy on homeowners based on appraisal value.
Huang Zhilong (黄志龙), chair of the macro-economic centre of the Suning Finance Research Institute, said to state media that the inclusion of the property tax as a first category legislative item means that it will be included as the “priority of priorities” for legislative work over the next five years.
Zhang Yiqun (张依群), head of the Jiling Province Finance Sciences Research Institute (吉林省财政科学研究所), said that the inclusion clearly signals that the launch of the property tax will be accelerated.
“The property tax could be submitted for review as early before the end of the year, before being released to the public for solicitation of opinions and the amendment process,” said Zhang, who expects the new tax to be launched as soon as 2020.
Zhang expects the property tax to be of benefit to maintaining the long-term stability of Chinese real estate markets by providing local governments will a more effective means of influence.