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Financials

China to apply VAT to some residential property sales - finance ministry

BEIJING, March 24 (Reuters) - China will apply value-added tax to residential properties sold less than two years after their purchase, the country’s finance ministry said on Thursday.

The government will introduce a 5 percent value-added tax (VAT) on the sale of all residential property held for less than two years.

In Beijing, Shanghai, Guangzhou and Shenzhen - cities which have seen some of China’s fastest property price increases - capital gains on the sales of larger homes held for at least two years will be subject to a 5 percent VAT levy.

Sales of smaller homes in the four cities will not be subject to the VAT levy, according to the statement.

For the rest of the country, sales of properties held for at least two years will be exempt from VAT.

Reporting by Beijing Monitoring Desk; Editing by Jacqueline Wong

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