On October 18, China's National Bureau of Statistics released China’s economic data for the third quarter, showing that the country's GDP grew by 4.9% compared to last year over the same period. This data is not as good as market expectations, and it is also far lower than the 18.3% and 7.9% growth rates in the previous two quarters.
In September, investment by real estate developers fell 3.5% year-on-year, apartment unit sales fell 16.9%, and the floor area of new construction projects started in that month fell 13.5%.
With the continued weakness of the real estate market and expectations of the government's imposing property tax, China's real estate stocks plunged yet again. So far, China's real estate stocks have generally fallen by about 20% this year.
On October 15th, the CCP’s media "Qiushi" magazine published Xi Jinping's speech on promoting "common prosperity", with the title "Solidly Promoting Common Prosperity." The article mentioned property tax, saying that "we must actively and steadily advance the legislation and reform of property tax, and do a good job of piloting."
Property tax has been one of the controversial topics during the past 10 years. In fear that the property tax would jeopardize the real estate market, and there has been resistance from officials, it has been difficult for the authorities to implement the policy nationwide. This time, the official media published Xi Jinping's speech, indicating that the authorities are really going to start collecting the property tax this time.
According to the Chinese media Caixin.com, China promulgated the "Property Tax Interim Regulations' ' in 1986, imposing a property tax on owners of commercial and renting residential properties. In 2011, the authorities assigned Shanghai and Chongqing as pilot sites to levy property taxes on homeowners.
So can China's real estate tax reduce the gap between the rich and the poor, and achieve common prosperity? According to the pilot operations in Shanghai and Chongqing, the property taxpayers will be the so-called middle class who own more than one apartment unit and have a relatively high-end life. It is precisely the target of the CCP scavenging for wealth. But for those who unfortunately bought unfinished units, the property tax can only increase their burden. The main purpose of the collection of property taxes is to increase local government's revenue, which may allow officials to get more bonuses but has no effect on increasing the income of ordinary people. The so-called common prosperity is nothing more than a shroud for the CCP to plunder wealth from its people.
#CommonProsperity#RealEstate#LyingFlat#UnfinishedBuilding#GhostCity#PropertyTax#HousingMarket#Developers#Mortgage#Loan#Officials#TaxRate#Shanghai#Beijing
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