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February 2, 2011

Land Tax policy in Hong Kong: book widely read in China

This just came to the attention of Landvaluescape. It is taken from an article in the South China Morning Post last July. Coming from someone who worked inside Hong Kong's property cartel, it confirms what many told me was wrong with Hong Kong's "free" market in land when I worked there myself in the early '90s (writes Tony Vickers).
Alice Poon Wai-han had sold fewer than 600 copies of her book on the Hong Kong property market and its domination by a few powerful developers, until a group of young activists persuaded her to translate it into Chinese.
Now the book, Land and the Ruling Class in Hong Kong - which criticises past and present governments for favouring major developers with high-land-price policies - has become the surprise hit of the Hong Kong book fair.
Almost 4,000 copies have been sold in the three weeks since the Chinese title was launched in late June, and Enrich Publishing is ready to put a third edition on the market.
Poon, who initially aimed the book at policymakers, knows her topic as she worked on planning and acquisition for major developers for decades before retiring in 2003.
Although "Land Premium" (a kind of huge Developers' Contribution that contributes around 40% of Government revenue in HK) makes the rest of the economy less burdened with taxes than anywhere else, it is far from perfect. Hopefully Chinese policy-makers will adopt what many have tried and failed to do in Hong Kong: an annual land-value tax. One effect would be to prevent the establishment of cartels, because the up-front sums for developers would be far smaller.

Posted by Tony Vickers at February 2, 2011 8:00 PM | TrackBack

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