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Chongqing and Shanghai trial property tax

0 CommentsPrint E-mail CNTV, January 28, 2011
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Chongqing and Shanghai municipal authorities have announced a trial for property taxation, starting from Friday. The move comes after the central government approved property tax reforms on a trial basis in some cities on Thursday.

 

Chongqing and Shanghai municipal authorities jointly announced the launch of trials for the long-awaited property tax.

It comes on the heels of another round of tightening measures, unveiled by the Chinese government on Wednesday. They include higher down payments, home purchasing restrictions in more cities, and annual price control targets for newly-built homes.

Chongqing will impose the new tax on all villas. It will also levy any new apartments priced at least twice the downtown average.

Annual tax rates are set at 0.5 percent of the transaction price for villas, and apartments priced less than three times the average price. It will be 1 percent for those priced three to four times the average, and 1.2 percent for those priced more than four times the average.

Over in Shanghai, newly-bought second and second-plus homes of permanent residents, will be taxed if the average total floor area of all homes owned, is more than 60 square meters per family member. In other words, each family member has an allocation of 60 square meters, which is exempt from the tax.

All new homes bought by non-permanent residents of Shanghai will be taxed. But buyers can claim refunds for first homes, after working in Shanghai for three years.

Shanghai's tax rates will be 0.6 percent for housing priced more than twice the city's average, and 0.4 percent for those of lower value.

The tax will initially be applied to 70 percent of the transaction price. It will later rise to the full home evaluation price, according to Shanghai's authorities.

 

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