Shanghai & Chongqing first cities for new property tax plans

CHINA: The Chinese government plans to impose property tax in Shanghai and Chongqing by the years' end to curb property speculation, according to a report by online news portal soufun.com.

The report added that the finance, taxation and housing ministries have worked out a detailed property tax plan, while Shanghai and Chongqing had been chosen as two pilot cities with detailed plans reviewed by the three ministries.

At the World Economic Forum’s Summer Davos in September, China's premier Wen Jiabao said that the government is determined to curb property market speculation and maintain stable housing prices.

He added that the nation will increase the supply of affordable housing.

The Chinese government had in April announced several measures to curb rampant property speculation, including an increase in the supply of land and a raise in minimum downpayments on property purchases.

After that, it also announced a limit on purchases of new apartments to one per family, as well as measures to curb bank lending to individual investors buying third properties and to those without one year of residency in urban areas.

In November, China reintroduced a nationwide real estate sales tax in an attempt to reduce speculation and cool the bubbling property market after price raises accelerated across the country.