Property Tax Gets No Mention in China’s 2021 Legislative Program
Chen Yikan
DATE:  Apr 22 2021
/ SOURCE:  Yicai
Property Tax Gets No Mention in China’s 2021 Legislative Program Property Tax Gets No Mention in China’s 2021 Legislative Program

(Yicai Global) April 22 -- A property tax, which could help to cool China’s real estate market, is absent once again from the country’s legislative agenda.

The Standing Committee of the National People’s Congress yesterday published its legislative work program for this year. It does not mention a property tax bill, suggesting that the keenly watched for tax will not be introduced in 2021.

The 14th Five-Year Plan, which runs through 2025, talks about promoting real estate tax legislation, but it does not say when the legislative procedure would be completed or when the property tax would be levied, Wang Huayu, deputy director of the Fiscal Taxation Law Research Center of Shanghai Jiaotong University, told Yicai Global. So, effectively there is no timetable for the legislation.

Such a bill is unlikely to be presented to the NPC Standing Committee for deliberation since it is not referenced in this year’s legislative program, Wang added.

But a number of tax experts believe that although such legislation is difficult, the government has not given up on it. It will continue to improve the draft law and promote the legislative work at the appropriate time. And despite the lack of a property tax bill this year, there will be significant progress in stamp duty tax law and tariff law, they said.

The draft stamp duty law will keep the current taxation framework and tax levels basically unchanged, and provisional regulations on stamp duty and relevant rules on stamp tax on securities trading will be elevated to become law.

Near Doubled Haul

The stamp duty collected on share trading surged 94.2 percent in the first quarter from a year earlier, mainly due to a big increase in market transactions. Revenue from the tax came to CNY88 billion (USD13.6 billion) in the three months ended March 31, the Ministry of Finance said yesterday.

The draft law on stamp-duty tax has passed its first reading, and it has a good chance of passing the second reading, likely to take place within the year, Wang noted. A third reading cannot be ruled out, however.

The tariff law was submitted to the State Council, China’s cabinet, for deliberation last year, but it has not yet been made public. 

Tax experts predict that the tariff legislation will also follow the principle of keeping the current taxation framework and tax levels unchanged, and authorize the State Council to adjust tariff rates in accordance with the needs of macroeconomic regulation and control.

Laws on value-added tax, consumption tax and land value-added tax may also be submitted for deliberation this year, Wang said.

Editor: Peter Thomas

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Keywords:   Personal income Wealth