BEIJING, Dec 17 (Reuters) - China on Wednesday unveiled fresh measures to prop up its real estate market, including tax cuts and easier credit for developers, in its latest efforts to cushion the blow of the global financial crisis.[ID:nPEK209153]
Following are some of the recent steps the world’s fourth largest economy has taken to counter an economic slowdown caused by shrinking demand for its exports and the belated impact of restrictive domestic policies, including tighter credit.
NOV 26 — The People’s Bank of China (PBOC), the central bank, cuts benchmark one-year lending and deposit rates by 108 basis points. It also cuts big banks’ required reserves by 1 percentage point and those for small- and medium-sized lenders by 2 percentage points, from Dec. 5.
NOV 6 — Bill rates tumble a day after the People’s Bank of China (PBOC) scales back liquidity-draining three-month bill sales from once a week to once every two weeks. It made a similar change to the schedule for 52-week bill sales the week before.
NOV 1 — The PBOC scraps lending quotas, Xinhua quotes spokesman Li Chao as saying.
OCT 29 — The PBOC cuts benchmark one-year lending and deposit rates by 27 basis points.
OCT 8 — The PBOC cuts benchmark one-year lending and deposit rates by 27 bp. It also cuts banks’ required reserves by 0.5 percentage points from Oct. 15.
OCT 6 — The PBOC reopens the medium-term note market after a four-month hiatus and lengthens maturities to seven years from five.
SEP 15 — The PBOC cuts the benchmark one-year lending rate by 27 bps but keeps deposit rates unchanged.
It also lowers reserve requirements by 1 percentage point for all banks except China’s five biggest lenders and the Postal Savings Bank. The reduction for local banks in areas hit by May’s earthquake is 2 points.
SEP 1 — The PBOC urges banks to lend more to the rural sector, small firms and regions hit by earlier natural disasters.
AUG 1 — The PBOC increases credit quotas by 5 percent for national banks and 10 percent for regional banks, directing them to channel the extra loans mainly to smaller firms, sources say.
NOV 17 — China raises export tax rebates for some rubber and wood products, glassware, bags, shoes, furniture, stone materials and aluminium sheet and strip, effective on Dec. 1.
NOV 14 — China scraps export taxes for some steel products, aluminium, rice, wheat, flour and fertilisers from Dec. 1.
NOV 12 — China increases export tax refunds on 3,770 tariff lines, or 27.9 percent of all exports, from December.
OCT 21 — China raises value added tax rebates on exports making up 25.8 percent of its tariff lines as from Nov. 1.
Refunds rise to 14 percent for some textile, garment and toy exporters. Manufacturers of ceramics, plastic and furniture products are among other labour-intensive industries to benefit.
JUL 30 — China raises tax rebates to 13 percent for textile and garment exporters, effective on Aug. 1.
DEC 17 — The State Council issued a slew of new measures to help the property sector, including cutting to two years from five years the lock-up period beyond which people can resell their property without paying a business tax.
It also scrapped the urban property tax for foreign firms and individuals and allowed people to buy second homes on the same preferential terms normally reserved for buying their first homes, if they meet certain restrictions on size.
NOV 12 — China says it will spend 900 billion yuan over three years to build affordable housing.
OCT 22 — The deed tax payable by first-time buyers of homes smaller than 90 sq m is cut to 1 percent. Stamp tax is scrapped for buyers and sellers, and the latter no longer have to pay VAT.
As part of the package of measures, the PBOC cuts the minimum mortgage rate to 70 percent of its benchmark lending rates and reduces minimum down payments for owner-occupiers to 20 percent. Mortgage rates on housing provident fund loans fall by 27 bps.
SEPT 1 — For regions hit by natural disasters earlier this year, the PBOC cuts the minimum mortgage rate to 60 percent of its benchmark lending rates. Down payments fall to 10 percent.
MAY-OCT — More than a dozen cities, including Shanghai, Nanjing and Hangzhou, announce various measures such as cash subsidies and tax cuts to encourage home purchases.
NOV 9 — China unveils a 4 trillion yuan (586 billion) stimulus package to boost domestic demand through 2010.
The central government will finance 1.18 trillion of the total and catalyse the rest from local governments and state-owned banks and enterprises. Economists debate how much of the headline figure represents genuinely new spending.
NOV 6 — China will spend 1 trillion yuan ($146.5 billion) over the next three years to rebuild areas ravaged by May’s Sichuan earthquake, media quoted the planning agency as saying.
NOV 5 — The China Business News says China plans to invest 5 trillion yuan ($732 billion) on roads, waterways and ports in the next three to five years, over 2 trillion yuan ($293 billion) more than the transport ministry’s initial plan.
OCT 25 — Media report that China has approved a total of 2 trillion yuan for railway investment since the start of 2004, over 1.2 trillion yuan of which has already been earmarked.
OCT 21 — The cabinet approves an infrastructure programme including highways, airports, nuclear power stations and hydro-electric power stations. No price tag is given.
SEPT 22 — China announces a tax break for public infrastructure projects approved since the beginning of 2008. In the fourth to sixth years after they start to generate revenues, they will get a 50 percent reduction on corporate income tax.
OCT 9 — China abolishes the 5 percent withholding tax on interest income.
SEPT 18 — China scraps the 0.1 percent stamp tax on purchases of equities and instructs Central Huijin, a government investment arm, to buy shares of listed Chinese firms.
The government also encourages state-owned firms to buy back shares in their listed units.
OCT 20 — China raises minimum grain purchase prices by as much as 15 percent, sets up a national soybean reserve and increases buying of grains, rapeseed and cotton for state reserves to help shore up farmers’ incomes.
OCT 12 — The ruling Communist party approves landmark reforms that give peasants the right to lease or transfer their land-use rights. The change is aimed at encouraging the agglomeration of small parcels, thus boosting productivity and encouraging investment. (Compiled by Langi Chiang; Editing by Ruth Pitchford)