Real estate tax is definitely not about competing for profits with the people.
Text/Ma Yuecheng
The debate about real estate tax has been going on for many years. Recently, it feels like it is getting closer, especially after the top management proposed to make up their minds to curb the rise in housing prices and establish long-term behavior in the real estate market. The mechanism is right in front of the case. A few days ago, a real estate tax plan for exporting to domestic sales was circulated on the Internet. It said that the property should be considered as well as the area. Taking comprehensive considerations, each household could not exceed two properties, and each person would be exempted from property tax based on 60 square meters. Overall, this plan can be recognized by everyone. However, we can also see that voices that oppose property tax and believe that property tax will not be launched in the short term are still emerging. At present, on the eve of the imposition of property tax, I think it is necessary to conduct some analysis and exposure of these remarks.
For example, someone quoted the famous economist Lang Xianping as saying that if a property tax is levied, it seems to be facing a disaster. I read Professor Lang’s article on property tax and felt that the professor’s article was a bit too emotional. Real estate tax is about the institutional construction of the real estate market, and it also has a certain role and significance in regulating the current real estate market. However, from Professor Lang’s analysis, he always regards some negative phenomena in our current society as the reason and basis for negating the real estate tax.
Regardless of whether it is Chinese or foreign, the starting point of any system is basic fairness and justice, but the approaches and methods may be different. No one will design a system that opposes fairness and justice. Who dares to openly confront the public? Isn't it tantamount to seeking death? However, from Professor Lang's article, we did not see the professor's institutional analysis of what is the essential difference between China's property tax and the United States' property tax. What is the essential difference between China's property tax and the United States' property tax? We should Which parts of are better to improve from ? We see that professors always say that there is corruption among current officials, and under such conditions, levying property taxes is counterproductive.
Indeed, if due to corruption, people's money is levied into the pockets of corrupt officials in the name of property tax, it will definitely be completely intolerable. But how is it possible? Although our system still has flaws, we are fully confident that the revenue from property tax will be mainly used for people's livelihood projects and work, and there is absolutely no possibility of inversion.
However, we should thank Professor Lang for his reminder that while establishing the property tax system, we should also establish a property tax supervision system, preferably to the level of law. Instead of putting the property tax in the cold palace with a stick, we can't stop eating because of choking.
It is reported that the property tax collection in Shanghai and Chongqing has encountered embarrassment. The increase in property tax in the two cities is almost negligible. Professor Lang believes that this small amount of property tax revenue does not have much impact on government revenue, thus denying the significance of property tax. This tax amount is indeed not surprising for the huge government finances, but doesn't it mean that the government does not regard the real estate tax reform as the main means of local fiscal revenue? If local fiscal revenue increases significantly as a result, you will definitely criticize the property tax on the grounds of competing with the people. Now there is less collected, and you say that there is no point in collecting. It's really weird. Doesn't the small collection just prove that the interests of the people are not harmed? The pilot schemes in Shanghai and Chongqing are all levied on so-called luxury properties and do not touch the interests of low-income people at all. This also proves the goal and direction of our property tax.
They all say that in the United States, property taxes are levied not to suppress housing prices, but to increase housing prices, hiding wealth among the people.. Isn’t this the same with China’s property tax? The role of property tax in suppressing housing prices is the same whether in China or the United States. China's property tax is not intended to suppress housing prices. If you think so, then when housing prices drop, the property tax will be abolished. Obviously this is impossible. Although the purpose is not to suppress housing prices, the effect must be there.
It is said that 28% of the property taxes collected in the United States are allocated to township governments, 22% to county governments, and 4% to state governments. In other words, half of the property tax goes to grassroots governments.The grassroots government will not use the money to engage in "three public" consumption, but to provide better public services, such as building a garden, a square, a green space, or hiring more police to maintain social order. China's property tax will not be stipulated to be used for , three public consumption, . Illegal use by officials is one thing, and system design is another. If you are aware of such illegal situations, you must establish a strict punishment plan.
Professor Lang said that if the local business environment improves, the local land prices and house prices will only rise, not fall! What happens after the value of people’s houses increases? 98.62% of the value-added part belongs to the people, and the government only uses 1.38% (the average property tax rate in all states in the United States in 2006) as property tax. This part is used to continue to transform the local environment, provide better municipal services and public security, and benefit the people. properties can further increase in value. What about the other half of the property tax? Use it to promote social equality and provide equal educational opportunities! 42% of property taxes are used for school district education funding. However, the professor also admitted that it is also a fantasy that property tax allows people to maintain and increase value. He gave an example: In the United States, if you fail to pay property taxes once, your house will be confiscated immediately! During this financial crisis, many American white-collar workers were forced to sleep in tents on the streets.
Regarding the possibility of corruption in the evaluation process, the professor was more direct and specific. What if you don’t want to pay? , what if you want to pay less? You will certainly find ways to bribe the appraiser, and in the end, our property appraisals may become a new form of corruption. It is possible that man-made money dies and birds die for food. The current social situation is difficult to completely avoid this, but can this be a reason to cancel the property tax? Since there are so many good methods and means abroad, why can't we learn from them?
Professor Lang admitted that property taxes always have some negative effects that cannot be eliminated, such as instability caused by economic cycles, unfairness between regions, inequality between generations, etc. And these problems have never been well solved even in the United States. Then why does the United States have to solve things when there is nothing easy to solve? The property tax they implemented under the constraints of an imperfect system should be implemented by us. Besides, we have the advantage of being a latecomer and will definitely do a better job. Lang Xianping angrily said in the article that if we imitate the United States in levying property taxes, we should just wait for the economy to collapse. All we can do is laugh. [This article was published by "Ma Yuecheng account" on August 19, 2018]
