Property tax will be levied sooner or later, and its expropriation time forms a subtle correspondence with the reduction of land transfer fees.
Oral / Wu Xiaobo
There has always been a policy hanging on our heads like ripe persimmons, ready to fall off at any time.
The policy is "property tax".
Whether the property tax will be levied, when will it be levied, and what kind of impact will it have on China's real estate market have always been a hot topic of discussion.
Today we will talk about "real estate tax", but we still have to start with "land transfer fee".
01
The Chinese government has an important fiscal revenue called "land transfer fee". Land transfer fee refers to the transaction fee paid by the government to the land use right to the land user, which can also be simply understood as "land price".
In 2018, the total tax revenue of the Chinese government was 15.6 trillion yuan. In addition, there is 6.5 trillion yuan of land transfer fees. The revenue of does not exist in the government revenue of many countries, so they all envy the Chinese government very much.
In the past decade, many Chinese local governments have made land transfer fees account for more than half of their fiscal revenue. For example, in my hometown of Hangzhou, the government's land transfer fee income in 2018 was as high as 244.3 billion yuan, accounting for 71% of the general local fiscal revenue in Hangzhou. This proportion is very amazing.
02
But the next problem is that although local governments can obtain hundreds of millions of land transfer fees every year, such rapid growth of income is unsustainable. will definitely slow down or even stagnate on one day because the urbanization process will definitely slow down or even stagnate.
China began urbanization in 1998, when the national urbanization rate was 33%. From 1998 to 2008, the urbanization rate increased by 15.7%, and from 2009 to 2019, an increase of 14.4%. Together, China's current urbanization rate has actually reached 60%.
The urbanization rate of 30%-60% is often the stage of rapid growth and explosion of the real estate market. Therefore, the land transfer fees obtained by local governments at this stage have also risen.
However, by the 80th anniversary of the founding of New China in 2029, the urbanization rate is expected to reach 70%. 70% means that China will reach the level of urbanization in general developed countries, which also announces that it will enter a long slow cycle until it is completely over one day.
So, more than ten years later, China's urbanization process was basically over, and the government had no more land to sell, and then the golden age of land transfer fees was completely over. The question is, is there a huge piece of income that can fill the vacancy in land transfer fees?
If there is, it is property tax.
Land transfer metal is sold in a one-time transaction, and one piece of land is sold less than one piece of land. Real estate tax is different. It is a tax on the holding process and has relatively more continuous collection ability.
According to the current official timetable, property tax legislation (note that legislation is not levied) is likely to be completed in 2020. Generally speaking, it is based on the principle of "legislation first, full authorization, and step-by-step advancement": after the real estate tax legislation, the central level will clarify a general framework, and then choose an appropriate time to implement it.
However, from research, legislation, pilot to implementation, there are too many benefits involved, and it will take at least several years to actually impose property tax.
03
Some students will ask, is the day when the property tax is collected the day when China's housing prices begin to drop overall?
In fact, there is no necessary relationship between the two. has only two reasons for levied property tax.
First, to supplement the government's fiscal revenue. Second, it is to adjust the fiscal revenue model of the central and local governments. Because most property taxes will become local taxes. In most countries in the world, property tax basically belongs to local taxes, so the day when property tax is collected is the day when China's fiscal and tax system reforms.
From a nature perspective, as a tax, property tax emphasizes stability and certainty, while regulatory tools require flexibility and timeliness, and there are inherent contradictions between the two. We cannot simply regard taxes as macro-control tools like interest rates and currencies.
Let’s look at some actual cases. Japan began to impose property tax in 1950. Over the next 30 years, Japan's housing prices experienced a period of continuous surge, until the Japanese economic bubble burst in the 1990s. So in Japan, property tax and real estate bubble do not form an equal relationship.
In early 2011, Shanghai and Chongqing, as pilot projects, introduced policies similar to real estate tax.
There are two types of people who collect real estate tax in Shanghai: one is the residents of the city who have newly purchased houses and own more than two houses; the other is the residents of the city who have newly purchased houses, with a tax rate of 0.6%.
. Chongqing collects single-family villas or high-end apartments, as well as second-family houses purchased without local household registration, jobs and investors, with a tax rate of 0.5%-1.2%.
From the actual situation, the property tax pilot has no significant impact on the prices of commercial housing and the prices of high-end residential housing. One of the major reasons for is that the rising rate of return on housing investment has far exceeded the increased holding costs due to property taxes.
04
If you want to regulate the real estate market by imposing property tax, such assumptions are unrealistic from the perspective of institutional implementation.
Based on this interpretation, we will conclude that is levied sooner or later. 's expropriation time forms a subtle correspondence with the reduction of land transfer fees. will be the turning point in China's real estate market from the incremental market to the stock market.
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