| HONG KONG
HONG KONG Nov 1 Hong Kong may take further
measures to control runaway property prices but the Asian
financial centre is likely to avoid steps such as a capital
gains tax which would be complicated, Kong Kong's leader, Leung
Chun-ying, said on Thursday.
Leung's government imposed a 15 percent tax on non-resident
and corporate buyers of property late last week and speculation
has been rife that further curbs will be imposed.
Leung told legislators in a question-and-answer session
there was no such plan for the time being, while adding: "We
don't rule out any possibilities or any proposals."
He said he wanted to ensure that the property market
developed in a healthy manner.
"But we have to bear in mind that Hong Kong has been
pursuing a simple and predictable tax regime. A capital gains
tax would be rather complicated."
While property prices grew across much of Asia in the second
quarter of 2012, those in Hong Kong rose significantly. Prices
in the city climbed 8.4 percent in the second quarter, up from
1.8 percent in the first quarter, realtor Frank Knight said.
To prevent the city being flooded with hot money after the
United States announced an aggressive new stimulus plan to spur
growth, Hong Kong's central bank in September ordered banks to
tighten up on mortgages.
That was followed by the new tax on non-resident buyers and
other measures on Friday.
Leung highlighted the extent of capital inflows into the
city of seven million people.
"Capital is flowing into Hong Kong, into its property
market. Some people buy luxury properties, we've seen soaring
prices there ... money is also flowing into shops, commercial
premises and car parks," Leung said, referring to prices of
parking spaces which have more than doubled in some districts in
less than a year.
"Our positive non-interventionist policy is outdated given
the internal developments and difficulties arising from the
external environment. The government has to be appropriately
proactive," he added.
(Editing by Robert Birsel)