China has consolidated property ownership data, but to levy tax is a separate struggle
Beijing’s 10-year debate on implementing a property tax and the shift from a 2019 deadline to complete legislation to an indefinite one are signs of entailed difficulty and hesitation
It took five years but China finally completed the consolidation of a national real estate information database last week, retiring the patchwork registration system that deprived authorities of a clear picture of property ownership across mainland cities.
The Ministry of Natural Resources, which led the project, also reiterated that the database was – contrary to market speculation – unrelated to implementing a proposed property tax that Chinese policymakers have deliberated on over the past decade.
“The officials said the system is not for collecting property tax and not for identifying an individual’s property portfolio, but this has already struck fear in the hearts of many people,” said Soho China chairman Pan Shiyi, who has 19 million followers on his social media Weibo account.
China’s housing boom in the past two decades has resulted in a growing group of asset owners, each sitting on multiple properties worth tens of million yuan, but who did not need to pay any form of tax because of the information gap. Many corrupt officials were also exposed for owning numerous properties following government investigations, showing the huge discrepancy between their wealth and incomes.
A centralised information system would clearly reveal an individual’s property portfolio, which in theory could force multi-home owners and corrupt officials to unload excess properties to avoid payments should the property tax be implemented, and evade arrests by anti-graft watchdogs.
