China Property:Chongqing to implement property taxes on individuals from 1Oct

Property tax on individuals to be launched on 1 October in Chongqing。

    According to the Local Tax Bureau of Chongqing, the property tax will becharged on individuals starting from 1 October. The targets are those ownersof standalone commodity residential units, or luxury residential units with ASPover RMB13,192 psqm; and those buyers without local hukou, not owning aenterprise, or without a job buying the second or more houses.

    Media reported that, for those standalone commodity residential units, orluxury residential units with ASP over RMB13,192 psqm, the owners have toreport and register to the related local tax authorities for related procedures ontax payment. In addition, for those buyers without local hukou, not owning anenterprise, or without a job, their new purchases of the second (and unitsthereafter) are also subjected to the property tax. The districts for the propertytax to be implemented will be the same as in the piloting programme, whichare the nine major districts, including Yuzhong, Jiangbei, Shapingba,Jiulongpo, Dadukou, Nan’an, Beibei, Yubei and Ba’nan.

    Strict punishment for delay in reporting。

    The announcement from the Local Tax Bureau of Chongqing stated that, forthose owners who have been noticed by the local tax authorities for reportingand still not taken related actions, the local authorities will charge on the delayaccording to the law. Media reported that a 5/10,000 of the tax will be chargedon a daily basis. Other punishments include: prohibition on departing of thecountry, media reporting, limitation on transactions, deductions from banks’accounts. Legal consequences will also be resulted.

    Official commented on the tax-free GFA。

    As reported by China National Radio (CNR), the staff from the Local TaxBureau of Chongqing said, for units owned prior to the piloting property taxprogramme implemented on January 2011, the tax exemption area forstandalone commodity residential units was 180 sqm. And the tax exemptionarea for newly purchased units is 100 sqm. There is no tax free area for thoseresidents without local hukou, not owning an enterprise, or without a job.