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Sunday, 23 August 2026
Old vs New Tax Regime: Tax Slabs, Deductions & Benefits AY 2026-27
Old vs New Tax Regime: Tax Slabs, Deductions & Benefits AY 2026-27
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https://www.youtube.com/watch?v=m721ntP_Cf8 3 August 2026 #chinaobserver Transcript :
Not long ago, a residential community in Danyang, Jiangsu Province suddenly experienced ground subsidence late at night. The foundation sank, cracks appeared throughout an entire building, and the windows became deformed. Videos recorded by nearby residents from daytime into the night captured the terrifying sounds of materials breaking and structures collapsing. hat night, a large number of ambulances and construction vehicles rushed to the
0:2626 secondsscene while many residents came outside to watch. When people saw the building at Gang the next morning, the windows had become completely twisted and
0:3434 secondsdistorted. Many residents said the scene was frightening and they wonder how anyone could feel safe living in a building like this. On June 18,
0:4242 secondsresidents of Shinua Bay West District in Taigan experienced another terrifying moment. They woke up to find that the living room floor inside their home had suddenly collapsed.
0:5555 secondsThe area was flat before. You can see the bottle hasn't moved. We put it right here. A few days ago, a friend was staying at my house. When he woke up, he
1:041 minute, 4 secondssuddenly noticed the grounds had sunk. I rushed over to take a look and there were cracks everywhere. The whole section had collapsed. I thought, "Oh my
1:111 minute, 11 secondsgod, is it still safe to live here? It's so dangerous. Is the house about to collapse or what? It's like a basin now. If I step here, the ground feels soft.
1:201 minute, 20 secondsThe door can't even close anymore. And this table is seriously tilted. It's terrifying." Some commenters mocked the situation,
1:281 minute, 28 secondssaying, "China's property management regulations require services to cover public areas, but the fees are charged based on the private floor area."
1:361 minute, 36 secondsAnother commenter said, "Property management companies simply won't deal with it. They drag things out until homeowners move away, and then the
1:441 minute, 44 secondsproblem is considered solved. The unresolved issues are passed to the next owner and then to the next. Over time, once the building becomes empty, someone buys it cheaply. Then it is redeveloped.
1:551 minute, 55 secondsThe market heats up again and the cycle of profiting continues. Everyone knows the playbook. On July 1, a vlogger uploaded a video showing the foundation
2:042 minutes, 4 secondsof their home sinking and cracks appearing in the walls. One commenter said, "The angle of these cracks show that this house is completely finished."
2:152 minutes, 15 secondsPeople have been asking, "What's the quality of homes in China today?" I could say this with certainty. Most homes Chinese people live in are
2:222 minutes, 22 secondsbasically falling apart. and the quality is extremely poor. To put it bluntly, they're like donkey droppings that look
2:292 minutes, 29 secondsshiny on the outside. They may look beautiful from the outside, but what's happening inside in places you can't see is a completely different story. Those who understand understand.
2:402 minutes, 40 secondsA homeowner complained, "I was afraid of retaliation, so I deleted the video after posting it.
2:492 minutes, 49 secondsPlease help share it. I spent more than 2 million yen on an apartment in Tanzin Lake community. I thought I was buying a
2:562 minutes, 56 secondshome, but after moving in, I realized I had bought a shoddy construction project. There are leaks, cracks everywhere, and the ceiling is covered
3:043 minutes, 4 secondswith holes. We'd be eating a meal, and the pieces of the wall would fall straight into our bowls. My child would be sleeping, and the dust could fall
3:123 minutes, 12 secondsinto their eyes. You can poke this loadbearing wall, and it turns into powder. After moving in, who knows if the whole building could collapse one
day? Who approved of this kind of substandard housing? How was it allowed to be handed over? I just want to ask, which department will stand up for
3:283 minutes, 28 secondsordinary people? A person online reported that the exterior walls of buildings in Jim International City
3:343 minutes, 34 secondsResidential Complex in Yin, Satan, had cracked so badly that a fist could fit through the gap.
3:483 minutes, 48 secondsThis is the famous cracked building at Jingbin International City. The crack has become extremely wide now. You can literally put a fist through it. And the higher you go, the wider the crack gets.
3:593 minutes, 59 secondsLook here. The exterior wall has completely split open. You can fit your hand inside. Even the floor stab has completely cracked. Homeowners at Yunya
4:084 minutes, 8 secondscommunity in Guangjo also said they recently discovered that the inside of their walls was filled with foam with no cement at all. One homeowner said in a
4:174 minutes, 17 secondsvideo, "Oh my god, this is terrifying. It's all foam inside. Look, it's all foam." And
4:264 minutes, 26 secondslook here, there's so much foam. It comes out as soon as I press it. We found another problem now. What are we supposed to do? I'm new to this
4:354 minutes, 35 secondsindustry, so you tell me. Is this some kind of new material, or is it cutting corners? This is the original wall. We
4:424 minutes, 42 secondshaven't touched it. The workers discovered it when they were putting up the tiles. A worker said that while he was installing tiles, he knocked on the
4:504 minutes, 50 secondswall and discovered that it sounded hollow. He first broke a small opening and found foam inside. After digging further, he discovered that in a 24 cm
4:594 minutes, 59 secondsthick wall, more than half of it was actually filled with loose foam. He said a house like this could collapse even without an earthquake. A resident in
5:075 minutes, 7 secondsYuang County, Djangi Province, reported that the roof of a residential building suddenly collapsed, damaging cars parked
5:155 minutes, 15 secondsbelow. The footage showed vehicle roofs crushed under the debris while alarms from cars across the community rang out continuously, creating a scene that
5:245 minutes, 24 secondslooks like something from a disaster movie. A resident in Hyang district province reported that the balconies on the third and fourth floors of building
5:325 minutes, 32 seconds14 unit 2 in Shali residential area suddenly fell off. A person in Shandong said in a video
5:425 minutes, 42 secondsthis is Nanhai new area and we hi Shandong. Look at the quality of this building from the top floor down to the first floor. All the balconies have
5:515 minutes, 51 secondsfallen off. Thankfully no one is living here yet. Otherwise, the consequences would be unimaginable.
This is a building in Juhai that is more than 20 years old, and this is what it has become now. So, when buying a home, don't worry too much about whether it has a 70-year or 50-year lifespan.
6:136 minutes, 13 secondsBecause in reality, homes in mainland China often don't even last 70 years.
6:186 minutes, 18 secondsAfter just 20 or 30 years, they can already end up like this. On August 19, a residential building in Shu Yaang
6:266 minutes, 26 secondsKurbe province collapsed in the early morning. Officials confirmed that some people were injured and taken to the hospital, but the exact number of
6:346 minutes, 34 secondscasualties and the cause of the collapse remain unknown. What has drawn attention is that the collapse happened before dawn when most residents were asleep.
6:426 minutes, 42 secondsHowever, the official statement did not identify the name of the residential community, nor did it provide details about the casualties or the cause of the
6:506 minutes, 50 secondscollapse, fueling speculation among many online commenters. Some commenters said, "What? It happened right here in my
6:576 minutes, 57 secondsarea. How come I haven't heard anything about it? Oh my god, it's not even safe to stay inside your own home. That's terrifying. There are many buildings
7:067 minutes, 6 secondslike this across China. Usually, nobody pays attention until something goes wrong." Others said, "This is a shoddy construction project. It shows that the
7:147 minutes, 14 secondsso-called 70-year property rights in China are basically a lie. Some buildings can't even last 30 years." The
7:217 minutes, 21 secondsissue of property ownership and their use rights in China has long been a sensitive topic for authorities. In recent years, as buildings approach the
7:307 minutes, 30 secondsend of their service lives and more lowquality housing projects emerge, the issue has increasingly been pushed into the spotlight. For decades, the biggest
7:387 minutes, 38 secondswealth miracle for Chinese households was built on illegal arrangements and a compromise that everyone understood but chose to ignore. When Chinese buyers
7:467 minutes, 46 secondspurchased apartments, signed 30-year mortgages, and poured nearly all their lifetime savings into concrete wars, they received a shiny property ownership
7:547 minutes, 54 secondscertificate. But a closer look at the document reveals that they never truly own the land beneath their feet. They only own the building, while the land
8:028 minutes, 2 secondsbelongs to the state. Residential land usually comes with 70 years of land use rights while commercial land typically
8:098 minutes, 9 secondscomes with 40 years. For the past 30 years, almost nobody cared about this issue. Why would they? Housing prices
8:168 minutes, 16 secondskept rising. Cities were constantly being rebuilt and the market looked like a fern burning with prosperity. When some people cautiously asked what would
8:258 minutes, 25 secondshappen after the 40 or 70ear term expired, authorities always gave vague but reassuring answers. The civil code
8:328 minutes, 32 secondsalso intentionally left the room for uncertainty, stating that residential land use rights could be automatically renewed after expiration, but leaving
8:418 minutes, 41 secondsout the most important question, whether the renewal would be free. Everyone assumed the government would find a solution later. Everyone believed that
8:498 minutes, 49 secondsin a fast growing economy, authorities would not risk shaking the most important source of wealth for hundreds of millions of urban residents. Now,
8:578 minutes, 57 secondsthis long-term delayed issue is finally coming to the surface. Shanghai recently introduced land renewal rules covering early commercial properties whose land
9:069 minutes, 6 secondsuse rights are expiring. Under the rules, property owners must apply for renewal when the land use term approaches expiration. If they do not
apply or if the applications are rejected, the government reserves the right to reclaim the land since the land itself belongs to the state. Buildings
9:239 minutes, 23 secondsconstructed on that land could lose their original market value and may even face difficulties with property registration. More importantly, the
9:319 minutes, 31 secondsrenewal fee calculation has attracted attention. Some may assume that under a normal system, renewing land use rights would only require a symbolic
9:399 minutes, 39 secondsadministrative fee or a payment based on the original land's price in 1992 adjusted for inflation. But the rules
9:479 minutes, 47 secondsstate that the renewal fees will be directly linked to today's benchmark land prices. Specifically, owners must pay no less than 70% of the current
9:559 minutes, 55 secondsbenchmark land price in the area. What does this mean? For example, in some parts of Shanghai in the early 1990s,
10:0310 minutes, 3 secondslands prices may have been only a few thousand yen per square meter, after more than 30 years of massive urban development, the same areas may now be worth 10 or even dozens of times more.
10:1410 minutes, 14 secondsUnder these circumstances, the renewal fee for some commercial properties could approach or even exceed the original purchase price of the entire property.
10:2310 minutes, 23 secondsAccording to the rules, after signing a lands renewal agreements, owners must pay most of the fees within a relatively
10:2910 minutes, 29 secondsshort period, 50% of the payment must be made within 30 days, while the remaining amounts must be paid within one year for
10:3710 minutes, 37 secondscompanies or individuals holding older commercial properties. This could create enormous financial pressure. According
10:4410 minutes, 44 secondsto a case cited by a new ping door previously acquired DBS bank tower with a total floor area of about 45,000
10:5210 minutes, 52 secondssquare m based on the luja office lanes benchmark price of 25,130 yen per square meter. A renewal at the
11:0111 minutes, 1 secondminimum 70% rate would cost about 17,591 per square meter. For a 50-year renewal,
11:0911 minutes, 9 secondsthe total cost would be about 790 million yen. A mainland Chinese blogger said on social media that the commercial
11:1611 minutes, 16 secondslands renewal policy could provide a reference for future residential land renewals. The blogger said that many commercial properties with 40-year land
11:2411 minutes, 24 secondsuse terms are now approaching expiration. And one key point of the new policy is that it provides for the first time a more specific reference standard
11:3311 minutes, 33 secondsfor renewal fees. The blogger also said that the new rules use current lands prices as the basis for calculating
11:4011 minutes, 40 secondsfees. Even at the minimum 70% rate, the renewal cost could still be far higher than the price paid for land use rights
11:4711 minutes, 47 secondsin the 1990s. He described it as making homeowners feel like they are buying their homes all over again at today's prices, raising questions over whether a
11:5611 minutes, 56 secondsproperty without land ownership truly belongs to the homeowner. To understand why this policy is emerging now, it is necessary to look at China's fiscal
12:0512 minutes, 5 secondsproblems. For the past 25 years, local governments in China have relied on a business model known as land finance, and it was once extremely profitable.
12:1412 minutes, 14 secondsLocal governments acquired rural land at very low costs, built roads, subways, and other infrastructure around it, then auctioned land use rights to property developers at much higher prices.
12:2512 minutes, 25 secondsDevelopers built high-rise apartments.
12:2712 minutes, 27 secondsOrdinary residents spent the savings of several generations to buy homes. And local governments use massive land sale revenues to fund public spending, build
infrastructure, pay government employees, and repay huge debts held by local government financing vehicles.
12:4312 minutes, 43 secondsThis model once operated like a perpetual money machine until it completely broke down. In recent years, China's property market has not simply
12:5112 minutes, 51 secondsgone through a normal adjustment. It has suffered a sharp decline under the pressure of developer defaults, overbuilding, and worsening demographic trends. Land sale revenues have plunged.
13:0213 minutes, 2 secondsIn many major cities, land auctions have repeatedly attracted no bidders, forcing state-owned enterprises to purchase land from local governments in what is
13:1013 minutes, 10 secondsessentially an internal accounting cycle to keep finances running. The traditional land finance engine has stored and cannot return to its previous
13:1813 minutes, 18 secondsstate. So when local governments can no longer rely on selling new land to pay their bills, where can they find new sources of revenue, the answer is to
13:2613 minutes, 26 secondsturn their attention to land that was already sold 30 years ago and turn expiring land use rights into a new source of income. For years, Chinese
13:3513 minutes, 35 secondsauthorities have discussed introducing a property tax. Some policy proposals suggested imposing an annual tax based on housing values to make up for the
13:4413 minutes, 44 secondsfiscal gap caused by declining land sale revenues. However, property tax is highly sensitive politically. Valuing
13:5113 minutes, 51 secondshundreds of millions of homes would also be extremely complicated and the policy could easily face public opposition.
13:5813 minutes, 58 secondsMore importantly, an annual 1% property tax would only generate steady but gradual revenue while land use renewal fees are completely different. They can bring in massive upfront cash payments.
14:1014 minutes, 10 secondsMore importantly, many corrupt officials and powerful individuals reportedly own dozens or even hundreds of properties.
14:1714 minutes, 17 secondsIf a property tax were introduced, it would directly affect these interests, which is one reason it has been difficult to implement. By contrast,
14:2514 minutes, 25 secondsland renewal fees do not immediately affect their interest. In other words, authorities have left them enough time to sell of properties because many of
14:3314 minutes, 33 secondsthese holdings are vacant and do not affect their daily lives. The unfortunate reality is that most ordinary home owners living in their own
14:4114 minutes, 41 secondsproperties may eventually be required to make one-time payments based on 70% of current market benchmark land prices.
14:4814 minutes, 48 secondsLocal governments would effectively gain access to a financial reserve far larger than ordinary property taxes could provide. In practice, this would be
14:5714 minutes, 57 secondsalmost like land finance 2.0. The difference is instead of selling new land to developers, authorities would be selling the same land again to existing
users when land use rights expire using the pressure of potentially losing land use rights. Some commentators argue that
15:1315 minutes, 13 secondsShanghai's document only targets 40-year commercial properties, not 70-year residential properties. But they overlook the fact that when Chinese
15:2115 minutes, 21 secondsauthorities introduce highly controversial wealth collection policies, they usually do not begin by targeting ordinary residential
15:2815 minutes, 28 secondsproperties as they could immediately trigger panic. A more common approach is to start with asset categories held by companies, investors, and wealthy
15:3715 minutes, 37 secondsgroups. This includes commercial real estate, international trusts, or overseas insurance products while first establishing the rules and enforcement
15:4515 minutes, 45 secondsframework. Looking at recent patterns, authorities first targeted overseas trusts held by wealthy individuals through tax investigations and
15:5315 minutes, 53 secondsretroactive audits. Then they strengthen tax enforcement on overseas insurance products purchased in places such as Hong Kong. Lastly, they followed by
16:0216 minutes, 2 secondstighter controls on capital outflows and restrictions on some professionals leaving the country. Each time, ordinary people could tell themselves, "This has
16:1016 minutes, 10 secondsnothing to do with me. This is a problem for the wealthy and speculators. I'm just an ordinary person with one or two homes. Now the policy focus has moved to
16:1916 minutes, 19 secondscommercial land renewal. Many ordinary workers may still think I don't own shops or office buildings. This is a problem for companies, but they may be
16:2816 minutes, 28 secondsoverlooking that the legal and fiscal logic emerging from commercial real estate could become an important model and precedent when residential land use
16:3516 minutes, 35 secondsrights eventually expire. Ironically, for many homeowners currently complaining about sinking foundations, cracked walls, and falling balconies,
16:4416 minutes, 44 secondsland renewal fees may not even be the most urgent issue they face. Their immediate concern is whether their homes will even survive long enough to receive
16:5216 minutes, 52 secondsa notice asking them to pay renewal fees.
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