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Planning body urges investment tax

The government should consider imposing a tax on fixed-asset investment to cool capital spending, the National Development and Reform Commission's Academy of Macroeconomic Research said in a report published in the official China Securities Journal Monday. Fixed-asset investment in urban areas surged 30.3% year-on-year in the first five months of the year, while investment in new projects rose by 23.6%. New loans could total US$375 billion, the report said, after the mainland's commercial banks handed out US$222 billion in new loans in the first five months of the year. The government originally set a new loan target for the year of US$312 billion. The academy also urged the People's Bank of China to raise deposit and lending rates if attempts to rein in investment growth proved unsuccessful. The bank raised the benchmark one-year lending rate by 27 basis points to 5.85% in late April.

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