Transaction tax may cool China housing-PBOC adviser

BEIJING, July 17 (BestGrowthStock) – Higher taxes on property
transactions would do more than a property tax to curb
speculation, an influential Chinese policy maker said in an
editorial published on Saturday, in which he advocated
maintaining current cooling measures in the second half.

Xia Bin called for a continuation of measures imposed in
the first half of the year, in order to counter “suspicion” in
the market over whether China is firmly committed to current
policies, in an op-ed in the Financial News.

Xia, one of three academic advisers on the People’s Bank of
China’s (PBoC) monetary policy committee, has knowledge of
central bank thinking but his comments represent his personal
views, not official policy.

Chinese housing prices dipped in June compared with May,
their first such fall since February 2009, prompting hopes
among real estate developers that tightening measures will soon
be abandoned. Regulators quickly denied the rumours
[ID:nTOE66C050].
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Reuters Insider Yi Xiaodi interview http://r.reuters.com/fub87m
Graphic on first-half sales: http://r.reuters.com/quk46m
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Xia did not lend much enthusiasm to a state think tank’s
proposal of a property tax to cool the housing market.

“The time frame for a property tax to be fully implemented
is likely to be rather slow. To truly control housing
speculation, it would be better to raise the tax rate on
property transactions,” Xia wrote.

High housing prices have become an obsession in Chinese
popular culture, with many urban young people worried they
won’t be able to afford an apartment until they have worked for
decades.

In an interview with Reuters Insider earlier this week, Yi
Xiaodi, head fo property developer Sunshine 100, said many
local governments are already circumventing the central
government’s tightening rules.

(Reporting by Lucy Hornby, editing by Jonathan Thatcher))

Transaction tax may cool China housing-PBOC adviser