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It's a shame property taxes aren't higher. It would be a free ride from the perspective of domestic tax payers. If one wanted to be protectionist, the increase

It's a shame property taxes aren't higher. It would be a free ride from the perspective of domestic tax payers. If one wanted to be protectionist, the increased taxes could be set to only apply to non owner-occupied residences.

seanmcdirmid 11y ago
Chongqing and Shanghai have tried this (applied property taxes to 2nd houses for luxury properties). But that is easily gained by simply throwing in a Smurf or two (put the house in a family member's name). Any system with rules that can be gamed is not going to work in China. The only solution is a tax on all property.
- PakG1 11y ago
  Any system with rules that can be gamed is not going to work in China. Case in point: http://world.time.com/2013/04/29/why-chinese-couples-are-divorcing-before-buying-a-home/ http://world.time.com/2013/04/29/why-chinese-couples-are-div...
nugget 11y ago
Some states in the US do have high property taxes. Texas, for example, hovers around 3%, and it's generally a much healthier fiscal environment for residents than states with lower property taxes (and higher income taxes), such as California.
- seanmcdirmid 11y ago
  Property taxes encourage good behavior in making people use their property productively. With property taxes, you just can't sit on property as a form of speculation, which would take it out of use to the detriment of the local economy. In china, even in first tier cities, you have a huge number of apartments that are unoccupied because they are bought for speculation reasons alone. China has a huge problem, however, in that property was bought already with upfront taxes and the assumption of no property taxes. Introducing a property tax now is going to make those people mad, understandably.
  - toomuchtodo 11y ago
    > China has a huge problem, however, in that property was bought already with upfront taxes and the assumption of no property taxes. Introducing a property tax now is going to make those people mad, understandably. Why would you assume economic rules would never change? Just because there is no tax today does not mean there's no tax tomorrow. If anything, you should aways be assuming taxes will be higher in the future.
    - seanmcdirmid 11y ago
      You buy X in the states knowing the rules of how X is taxed. Property taxes might go up on X in the future, but you know that. Now consider buying X in China. You have to pay a tax up front, and the developer paid a tax (or well, paid for the land). Also, X's price is much higher since the assumption is that X will not be taxed in the future. Now China introduces a completely new property tax on X and all your assumptions are destroyed. The rules of the game are different, and now you can't resell X under the same assumptions.
      - deleted 11y ago
        [deleted]

seanmcdirmid 11y ago

Chongqing and Shanghai have tried this (applied property taxes to 2nd houses for luxury properties). But that is easily gained by simply throwing in a Smurf or two (put the house in a family member's name). Any system with rules that can be gamed is not going to work in China. The only solution is a tax on all property.

PakG1 11y ago
Any system with rules that can be gamed is not going to work in China. Case in point: http://world.time.com/2013/04/29/why-chinese-couples-are-divorcing-before-buying-a-home/ http://world.time.com/2013/04/29/why-chinese-couples-are-div...

nugget 11y ago

Some states in the US do have high property taxes. Texas, for example, hovers around 3%, and it's generally a much healthier fiscal environment for residents than states with lower property taxes (and higher income taxes), such as California.

seanmcdirmid 11y ago
Property taxes encourage good behavior in making people use their property productively. With property taxes, you just can't sit on property as a form of speculation, which would take it out of use to the detriment of the local economy. In china, even in first tier cities, you have a huge number of apartments that are unoccupied because they are bought for speculation reasons alone. China has a huge problem, however, in that property was bought already with upfront taxes and the assumption of no property taxes. Introducing a property tax now is going to make those people mad, understandably.
- toomuchtodo 11y ago
  > China has a huge problem, however, in that property was bought already with upfront taxes and the assumption of no property taxes. Introducing a property tax now is going to make those people mad, understandably. Why would you assume economic rules would never change? Just because there is no tax today does not mean there's no tax tomorrow. If anything, you should aways be assuming taxes will be higher in the future.
  - seanmcdirmid 11y ago
    You buy X in the states knowing the rules of how X is taxed. Property taxes might go up on X in the future, but you know that. Now consider buying X in China. You have to pay a tax up front, and the developer paid a tax (or well, paid for the land). Also, X's price is much higher since the assumption is that X will not be taxed in the future. Now China introduces a completely new property tax on X and all your assumptions are destroyed. The rules of the game are different, and now you can't resell X under the same assumptions.
    - deleted 11y ago
      [deleted]