The Chinese government is to raise tax rates through new urban
land use tax regulations, in a bid to strengthen macro-economic
control policies.
In a State Council meeting presided over by Premier Wen Jiabao on Saturday, China's cabinet decided
to amend the provisional regulations on taxes on urban land use
issued in 1988.
The new unified tax rates will be unilaterally applied to
domestic and foreign companies to foster fair competition.
China's economy grew 10.7 percent in the first three quarters of
this year, with fixed assets investment surging 27.3 percent. This
has caused the government to seek for effective economic cooling
methods, with checking excessive growth of credit and land supply
high among these.
Measures have been taken to tighten land supply in the second
half of 2006, including setting higher taxes on urban land use and
stripping local governments of their authority to spend land sale
funds.
(Xinhua News Agency December 31, 2006)