(Yicai Global) Jan. 17 -- Real estate taxes are too complicated and sensitive to be fully implemented in the short term, Sheng Songcheng, a counselor of the People’s Bank of China and the executive vice president of CEIBS Lujiazui International Finance Research Institute, told Yicai Global.
China should work towards levying real estate taxes in the future, he said. Doing so is of great significance in improving the tax system and in the healthy and steady development of the real estate market, said Sheng, adding that such a tax would reduce the gap between the rich and the poor. China will not be ready to implement such a plan soon, he said.
Real estate taxes involve property and land. China needs to clarify its purpose for collecting them, he said. The country must answer questions about thresholds, collection and other topics, said Sheng.
Some local governments get more than half of their revenue from land sales. How taxing real estate will affect this source of income remains to be seen.