New tax hits property developers

Property stocks took a hammering Wednesday as China announced a new tax on real-estate developers. Although the move is intended to slow down the booming property sector, analysts say it might do little to reduce soaring prices, the Wall Street Journal reported. Property stocks fell 10% Wednesday after the Tuesday announcement by the State Administration of Taxation of a new tax that would kick in February 1, taking as much as 60% of the profits from real-estate projects. The tax bureau said the move is meant to boost its revenue but analysts suggested it might reduce the allure of investing in property. The move revives an existing rule that was not enforced, the newspaper reported. Read more real estate updates at China Property News.