Several local governments are preparing for property tax expansion, local media has reported.
People familiar with the situation say that many cities have enacted trial plans, but governments are still hesitant of the influence of the tax on the local property market.

According to China Securities Journal, local governments have secretly sent staff to Beijing to communicate with Beijing on the tax expansion, and some research institutes have also sent researchers to other cities.

But according to analysts, local governments are quite doubtful of the policy. "The tax will lower tax revenue for the local market and also influence the environment for the property development industry," said one unnamed source.

Up to now, no city has explicitly shown their attitude towards the property tax. There were some reports on the trials in small to middle size cities, but haven't been confirmed.

Experts in the industry say that the direction of levying property taxes has been decided by the central government--the only problem is deciding when to promote the next round of trials.

The instability of fiscal revenue also requires fast decisions from the government. Figures from the Ministry of Finance show that state-owned land transfer fees totaled 2,009.3 billion yuan, accounting for 20 percent of all fiscal revenue. With the downward trend in the property market, the land market performed badly in October. Land transfer fees decreased by 21.7 percent.

Analysts say that the figures showed two problems: land transfer fees account for a large part for fiscal revenue, and the land transfer revenue is unstable. Compared to the land transfer fee, property tax will be much more stable. On the other hand, the property tax will be an adjustment tool for the property market, and a "limited quota for house purchases" may be a replacement.

According to the insiders, the property tax expansion may be implemented in 2013, after the Central Economic Working Conference.