People’s Daily published an article titled, “It Is a Dangerous Sign that Revenue from Selling Land Has Become the Major Source of Income for Municipal Governments.” The article said that, according to the statistics published by the Ministry of Land and Resources, in 2013, income from land sales was 4.1 trillion yuan (US$0.67 trillion) which was 33 percent of the national income. The article stated that, ten years ago, the cost of land was 20 percent of the cost of housing. In recent years however, it has grown to be 60 percent or even higher. The article pointed out, “Land sales may appear positive but it sends many dangerous signals. … The municipal government can easily rely on land as its income source rather than developing its own economy or making changes to its economic structure. This also increases the financial risk while it impairs the stability and safety of the tax revenue.”
Source: People’s Daily, February 23, 2014
http://finance.people.com.cn/n/2014/0223/c1004-24436578.html