Tax only raises cost of housing

The burden of the new tax on sales of previously owned houses will only be shifted to buyers while continuing to push up housing prices, says an article in Guangzhou Daily. The following is an excerpt:

Starting from the middle of this month, Shanghai began to impose a land appreciation tax on the trade of previously owned houses that are less than five years.

The move represents the Shanghai municipal government's latest attempt to cool down the red-hot real estate market. It follows last year's collection of a business tax and individual income tax. Combined, these taxes account for nearly 10 percent of the cost of a secondhand home in Shanghai.