Beijing researching property tax

BEIJING - Authorities in Beijing are conducting "basic research" into a property tax for the city, a local housing official has said, as the market watches whether the Chinese capital will follow the steps of Shanghai and Chongqing to curb speculation.

"But it's still not clear when the property tax will be introduced in Beijing," Yang Bing, director of the Beijing Municipal Committee of Housing and Urban-Rural Construction, told a local radio program Monday.

China introduced property tax trials in the cities of Shanghai and Chongqing at the beginning of last year as part of efforts to curb runaway home prices.

The country is mulling further property tax reforms and property tax trial expansions so to consolidate its efforts in real estate market regulation, Finance Minister Xie Xuren told reporters earlier this month on the sidelines of the annual parliamentary session.

The reform will be promoted "actively yet steadily," and property tax trials should be expanded to other cities in the nation "on a proper scale," Xie said.

The Ministry of Finance, together with other departments, is working with the municipal governments of Shanghai and Chongqing to collect information from the year-long trial for future expansions, he said.

China has imposed a raft of measures since 2010 to cool the runaway market, including higher down payments, higher loan rates, a ban on third-home purchases, property-tax trials and the construction of low-income housing.

In February, new home prices in 45 out of 70 major cities monitored by the government fell from the previous month, according to the National Bureau of Statistics.

Yang said that 91.3 percent of the home buyers in Beijing are of "rigid demand" now, and the investment and speculative demand has been contained.

"But it will take a long period of time for the housing prices to return to a rational level. Beijing will continue to carry out those restrictive measures," he said.