MOF considers adding pre-sale homes to luxury tax

The China Post news staff

The China Post news staff — The Ministry of Finance (MOF) has not ruled out including pre-sale homes and “fake farmhouses” in the non-residential transaction tax under the proposed “luxury tax,” the MOF head told lawmakers yesterday. The current “luxury tax” bill, which received preliminary approval Wednesday, does not include pre-sale homes and fake farmhouses — properties that are listed as farmhouses but are used for purposes unrelated to farming — in the list of second home properties applicable for an extra tax of 15 percent when sold within 1 year of purchase and 10 percent within 2 years of purchase.

When questioned during a Legislative Yuan hearing by lawmaker Lu Shiow-yen (盧秀燕) of the ruling Kuomintang about whether the MOF is considering adding these types of properties into the bill to prevent speculative investors using them as a safe haven, Lee said that nothing is off the table. Lee, however, also stressed that the luxury tax bill is drafted not to “knock out” the property market but to ensure its healthy development.