China may delay property tax expansion - paper

BEIJING (REUTERS) - China may postpone expanding a trial property tax nationwide, a senior tax official said in remarks published on Monday.

Mr Wang Kang, the chief accountant of the State Administration of Taxation, said both the tax bureau and finance ministry were still working out which cities to include and the rate of tax to be levied in the pilot's expansion, according to a report in the official Economic Information Daily.

Beijing has been actively studying an expansion of its experimental property tax after it kicked off the pilot programme in Shanghai and Chongqing in 2011.

Many industry observers and officials had expected the government to introduce the tax to more cities from late 2012 to curb rising home prices.

China's Finance Minister Xie Xuren has also pledged to deepen the property tax reform in 2013 as part of efforts to revamp the country's outmoded tax regime.

The Chongqing municipal government has recently announced it would raise the threshold at which the tax is levied. It will be applied to homes with a purchase price of 12,779 yuan (S$2,500) per square metre, up from the previous 12,152 yuan per square metre.

Analysts say Chongqing's move sends a signal that the local governments are looking for ways to circumvent Beijing's bid to curb home prices, which may give a further boost to a recent acceleration in housing costs.

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