The Evaluation Of Reform Of Property Tax And Effect On The Household Saving

Real estate taxes policy is an efifective instrument for real estate market regulation and socio-economic resources distribution. It provides revenues for local govenments and plays a very important role in the entire tax system. Real estate taxes policy has become a important tool for real estate market macro-control, along with the implementation of land supply and finance policies. Regulation of real estate with the previous methods, such as housing restriction policy, limited credit and land transfer fees. The difference is that property tax reform will have a long-term, through taxation on Housing hold link.Further inhibit investment and speculative demand in the real estate market.The reform of property tax started in February28,2011, Shanghai and chongqing selected for pilot cities.Although the details of the content differ, but the two pilot cities have highly targeted, focus on large area of housing, luxury housing and more housing units over the standard. This limit speculation has play a positive role, refrain housing speculateand polarization of house consumption, in theory, will not affect the reasonable needs of residents own homes. Property tax reform has been two years since the pilot run time, how effective property tax reform? Have an impact on prices pilot areas? And property tax reform can play a role in regulating income distribution? These are the focus of attention of property tax reform.Comparing the previous literature, this paper has done the following work:First, from the literature review, the historical process of property tax reform, the role of property taxes, real estate taxes, and compare foreign Comment property tax reform aspects of the real estate tax for a detailed introduction, research and lay the foundation of this article.Secondly, from the theoretical and empirical aspects of property tax reform has verified the pilot areas, the impact of property tax reform pilot area housing prices.This paper analyzes the reform of property tax on the price impact and the transmission mechanism, and then through constructing consumer-developer model and investor-developer model proved the inference. Taking the implement of property tax in February,2011in Shanghai and Chongqing as a natural experiment, the paper takes the Synthetic Control Methods in the project evaluation to estimate the influence of property tax on house prices of pilot city. Based on forty large and medium-sized cities panel data from June2010to February2012, we find the property tax imposed in February of2011has noticeably restrained the trend of house price in Pilot city rising. The implementation of property tax reduced the average house price by165.83-358.99yuan/m2in pilot city relative to implicit housing price. The decline range is5.36%. But And a series of placebo test also confirmed that influence of property tax is statistically significant. Although the performance in Shanghai housing prices decline, but the decline is small, the results of tSynthetic Control Methods and DID model estimates are not significant.The property tax reform are " narrow tax base ", mainly for large-area housing property tax, The people were prepared to buy a large area of housing will bear a greater tax burden, while unable to purchase housing in other cities, thus they will be motivated by tax avoidance initiative to other types of housing markets, and thus a structural distortion of the housing market. By establishing a double difference method (DID) model, empirical tests of the impact of property tax reform on the housing price structure. The study found that a property tax rates in effect on the impact of large-area housing market is more obvious, the average effect of the real estate tax is mainly composed by a large area of the housing market;2, due to the presence of extrusion needs, a small area of the housing market prices but grow faster. Starting point for property tax policy is to promote the welfare of low-income groups, I hope through the property tax levy to speculation out of the market, thereby reducing prices, making those low-income people can afford housing, and that the conclusions of this study indicate that at least the policy does not achieve the desired effect, but reduces the welfare of low-income groups.Because the effect on property tax reform in Chongqing research on housing prices, especially the structural impact on housing prices. Successively by further theoretical and empirical validation of the property tax reform pilot areas, the impact of property tax reform on household savings behavior of the pilot areas. Through the establishment of property taxes——high-income earners and property taxes——alow-income persons models, the effects of property tax reform for different income levels of household savings behavior. Empirical validation through the establishment of the DDD model and the DID model empirical analysis of this phenomenon, researchers found that property tax reform on savings behavior of low-income residents obvious impact on high-income residents had no obvious effect. Property tax reform for low-income residents’ savings on average improved8.67percentage points, the impact on the income of the median between25%-50%of which more than25percent strongly below the level. This study also shows that contrary to the original intention of property tax reform policies, to some extent undermined the welfare of low-income residents, they had to rapidly rising prices and save more.Finally, this paper put forward policy recommendations to promote property tax reform nationwide, mainly involving collection of property tax reform measures and related measures of property tax reform in two ways. This study is the study of the operation of property tax reform, not only for the first time theoretical and empirical research on the impact of property tax reform residential housing prices, and verify that the property tax reform because of its "narrow tax base" feature, will lead to crowded tax demand caused by the shift. Also the first attempt to study the effects of property tax reform for different income levels of household savings behavior, explained by the loss of savings behavior in the welfare of low-income residents. And property tax reform as an exogenous policy shocks and savings rates, better validation of the relationship between household savings rates behavior. Contents of this article has important theoretical and practical significance for the promotion of the country’s real estate tax reform.