Wang Jianfan, director general of taxation at China’s Ministry of Finance, said today that the 14th Five-Year Plan will “actively and steadily promote real estate tax legislation and reform”. Beijing has repeatedly proposed to speed up real estate tax legislation since 2013, but it has not yet entered the legislative agenda.
Wang Jianfan mentioned at a press conference held by the State Council Information Office on July 7 that the “14th Five-Year Plan” will “implement the outline of the ’14th Five-Year Plan’ and accelerate the establishment of a modern fiscal and taxation system”. During the “14th Five-Year Plan” period, the direct tax system, mainly income tax and property tax, will be improved, gradually increasing its proportion of tax revenue, and “actively and steadily pushing forward real estate tax legislation and reform”.
The Chinese government also mentioned the property tax in the “Outline of the 14th Five-Year Plan and the 2035 Visionary Goals” announced in March. “Chapter 21, section 2 of the “Outline” states that it is necessary to “push forward property tax legislation, improve the local tax system, and gradually expand local tax administration.
However, the Chinese Communist Party officials have repeatedly expressed their position since 2013 to speed up the legislation of real estate tax, but so far “only heard the sound of the stairs”.
In 2017, the 5th session of the 12th National People’s Congress of China said that the draft real estate tax was not scheduled to be submitted to the Standing Committee of the National People’s Congress for consideration because it “involves a wide range of aspects”, according to Surfing News.
After that, in the press conference of the National People’s Congress in 2018 and 2019, the response on the topic of real estate tax refers to the relevant departments are drafting and perfecting the draft law, important issues such as proof, to be submitted to the Standing Committee of the National People’s Congress for consideration when the time is ripe.
Chinese Premier Li Keqiang did not mention real estate tax in this year’s government work report. The last time it was mentioned was in the 2019 government work report, when the statement read, “Improve the local tax system and steadily promote real estate tax legislation.”
Jia Kang, former director of China’s Ministry of Finance Scientific Research Institute, said in a recent interview with the land media that according to the legislative arrangement of the 13th National People’s Congress, the real estate tax will start legislation within the term of the current National People’s Congress.
The current term of the NPC is from March 2018 to March 2023, which means that the real estate tax legislation should be launched before 2023.
The official government work report of the Chinese Communist Party mentioned for the third time this year the concept of “houses are for living, not for speculation”, which made the outside world concerned about whether the Ministry of Finance’s statement this time announced that China will officially start the real estate tax legislation that has been brewing for years.
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