\nTaiwan is considering a new property tax on real estate sold within a year of purchase and plans to revise land valuation rules to further quell the risk of overheating in its property market.\n<\/p>\n
\nGovernment officials said that the tax will be aimed at investment properties and not at ordinary buyers who want a home for their own use. Land valuations will also be revised more regularly to ensure taxes reflect market changes, said Wang Ching-hsiu, a deputy director of the Interior Ministry.\n<\/p>\n
\nIt is hoped that the new tax will discourage short term investors from speculation in the property market and could help curtail prices. But some commentators are sceptical as previous credit tightening measures have failed to curb real estate prices.\n<\/p>\n
\nAt the end of September Taiwan\u2019s central bank increased its benchmark interest rate by 0.125% for the second time this year after a jump in real estate prices fuelled concern that the Asian island\u2019s economic recovery could create a property bubble. Prices in the capital rose 7% from December 2009 to the end of September, according to Stanley Su, an analyst at Sinyi Realty, Taiwan\u2019s biggest real estate brokerage.\n<\/p>\n
\nThe government is studying the tax and no date has yet been given for when it will be introduced. \u2018We hope this would discourage speculation,\u2019 said Ching-hua Lee, chief secretary at the Ministry of Finance.\n<\/p>\n
\nThe tax on property sales could be as high as 30%, the Taipei based Economic Daily News reported, citing an unidentified official at the Ministry of Finance. Lee said the ministry hasn\u2019t decided on the tax rate.\n<\/p>\n
\nTaiwan also plans to revise its so called published property values every year starting as early as the second half of 2011, said Wang, who works at the Interior Ministry\u2019s land department. The benchmark for annual real estate taxes is now revised every three years.\n<\/p>\n
\nThe declared land values, used to calculate taxes on the increase in the worth of properties, will be revised when necessary to bridge the gap with current market prices, she said. Those valuations are now revised yearly.\n<\/p>\n
\n\u2018We will act to enhance taxation fairness as investors who buy and sell land within the same fiscal year won\u2019t be taxed against gains under current land value increment tax rules,\u2019 Wang added.\n<\/p>\n
\nPlunging interest rates drove prices of residential property in the greater Taipei area up by 20% last year, according to Sinyi Realty. The increase in property prices has made it more difficult for first time buyers to purchase properties. Some eight banks partially owned by the government, hae been asked to offer $6.6 billion worth of mortgages at lower interest rates for buyers aged between 20 and 45.<\/p>\n","protected":false},"excerpt":{"rendered":"
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