China's Xi faces resistance to property-tax plan - WSJ

Chinese President Xi Jinping speaks at a meeting commemorating the 110th anniversary of Xinhai Revolution at the Great Hall of the People in Beijing, China October 9, 2021. REUTERS/Carlos Garcia Rawlins/File Photo/File Photo

Oct 19 (Reuters) - Chinese President Xi Jinping is facing resistance over a nationwide property tax aimed at curbing housing speculation, the Wall Street Journal reported on Tuesday, citing people with knowledge of government deliberations.

Earlier this year, Xi assigned to Han Zheng, the most senior of China's four vice premiers, the task of rolling out the levy much more widely, according to the report.

However, Beijing is now settling for a limited tax plan because of strong pushback, while a proposal involving state-provided affordable housing is emerging as an alternative, the WSJ reported.

An initial proposal to test-run the tax in some 30 cities has been scaled back to around 10, the report said.

In an essay in the ruling Communist Party journal Qiushi, published by the official Xinhua news agency on Friday, Xi had called for China to "vigorously and steadily advance" legislation for a property tax.

China has mulled such a tax for over a decade but faced resistance from stakeholders including local governments themselves, who fear it would erode property values or trigger a market sell-off.

In internal debates, the feedback to Xi's property-tax plan from both the party's elites and its rank-and-file members has been overwhelmingly negative, the WSJ report said, citing the people familiar with the deliberations.

Reporting by Akriti Sharma in Bengaluru; Editing by Shounak Dasgupta

Our Standards: The Thomson Reuters Trust Principles.