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China Property Tax Trial Likely Delayed During Real Estate Slump

  • In 2021, government authorized expanding trial to more cities
  • But house prices are falling, property developers defaulting

China’s property tax could be another casualty of the slump in the housing market, with analysts expecting the government to hold off on expanding trials of the levy because of a real estate-led economic slowdown.

In October last year, China’s parliament authorized the limited property tax in Shanghai and Chongqing be expanded to more cities, with some analysts forecasting that it could begin by the end of 2021. However, the rapid deterioration of the real-estate sector and the lack of any detailed implementation plan from the State Council is fanning speculation that the government is waiting for a market uptick before it starts the tax.