In 2017, the U.S. under President Trump’s rule cut taxes, spearheading a “global tax cut race,” mainly to suck in manufacturing back into the country. But now the U.S. Biden administration is starting to raise taxes, so it must pull the major global economies together so that it does not lead to an exodus of U.S. businesses. Now the U.S. is starting to call for everyone to unite and take on the multinationals together.
The day China’s land finance dries up is the day the real estate tax will make a strong appearance
But from the standpoint of national competition, the best strategy is: lower taxes! Provided, of course, that the fiscal situation is affordable.
Taking advantage of the U.S. tax increase, the Communist Party of China has also announced that it will cut taxes, hoping to widen the “tax gap” to attract more U.S. companies to itself. Of course, it is not easy to say whether the real reduction, but the slogan must be shouted out, otherwise how to fool the sweet foreign investment to come in?
On April 7, at a press conference held by the State Council Information Office of the Communist Party of China to implement the outline of the 14th Five-Year Plan and speed up the establishment of a modern fiscal system, Assistant Minister of Finance Ou Wenhan said that institutional tax reduction policies will continue to be implemented. For example, the previously introduced institutional tax reduction and fee reduction policies, such as the reduction of VAT rate, VAT withholding tax refund and special additional deduction for personal income tax, will continue to be implemented so that the policy iteration effect will continue to be released. “We strongly support any form of tax reduction; we do not agree much with any situation of tax increase. If you want to gain a relative competitive advantage in taxation, the corporate tax burden must be reduced, reduced and reduced again.”
The key question is, can the Chinese government really go against the wind, lower corporate taxes, and come after multinational corporations with the United States? It can be said that the Chinese Communist government has been saying good things and doing bad things. It has been following the U.S. in crying out for tax cuts these past few years, but in fact it really hasn’t cut much, or there wouldn’t be the death tax rate. Especially in these two years, the impact of the epidemic, tax sources decreased, spending increased, local debt, special debt issuance is basically open to the mouth, the fiscal deficit soared. It is difficult to cut taxes at this time, so to speak.
But even so, many people in the country, as well as foreign companies, still very much eat this set, that China’s tax is really reducing. But the problem is that China is a big government, with very large expenditures and a large fiscal deficit. With a lower corporate tax, the treasury will certainly not be able to make ends meet and must be supplemented by other taxes in order to circulate properly. Where to increase revenue from? So, the property tax was put on the agenda.
In the matter of property tax, experts from all walks of life don’t jabber from the perspective of what laws and so on, nothing is important. There is only one consideration for the advancement of property tax: stability.
On April 7, China’s Ministry of Finance once again said that it will actively and steadily promote the legislation and reform of the property tax.
For the property tax, in fact, there has been constant buzz over the years, and the real estate tax legislation has been included in the legislative planning of the Standing Committee of the 12th and 13th National People’s Congress, and also in the annual legislative work plan of the Standing Committee of the National People’s Congress many times, but so far it has not been completed. In my estimation, the possibility of launching it next year is very high: the outline of the 14th Five-Year Plan and the 2035 Vision is “to promote real estate tax legislation”, which clearly reflects the positive attitude.
The technical preparations are almost done, such as the networking of property information, etc. Take a look at today’s hot search: “Establishing a perfect personal income and property information system”, almost all of which is to prepare for the introduction of property tax. Remember: the day China’s land finance dries up is the day the real estate tax will make a strong appearance!
The property tax will have a major impact on the whole industry. Such a huge policy adjustment must be resolved before the industry enters recession, otherwise the industry decline iterative policy blow, China’s real estate is likely to play the collapse. Therefore, I just think that the domestic property tax levy, can not wait too long, the probability is that the two years of the matter.
Recent Comments