Press release №681
24.04.2007
REAL ESTATE TAX: THE RICH ONES SHOULD PAY MORE

IN BRIEF

MOSCOW, April, 24, 2007. Russian Public Opinion Research Center submits information whether Russians find it fair that the real estate tax practicy does not depend on quality and market price; what should become a basis for the estimation of the real estate tax; what should the authorities do about the fact that in major cities a considerable part of real estate is bought for leasing purposes or resale.

The majority of Russians (68%) consider the fact that the real estate tax practicy does not depend on quality and market price of an apartment unfair. 13% of respondents think it is fair: from 10% of financiy unsuccessful up to 17% of those who are financiy well-to-do.

The suggestion of real estate tax evaluation on the basis of market price is perceived positively by 47% of respondents; there are bit less (37%)of those who think of this suggestion negatively. The part of this new real estate tax supporters is the highest in Moscow and St. Petersburg residents: 66%. Opinions of other major cities differ (44% approval, 43% disapproval).

Real estate tax estimation should be based on the owner's level of income (as 35% of interviewed identify) and the quality of a place of living (as 30% of respondents think). Less important factors of such estimation are such things as the apartment's or house's total metric area (10%), the book value of an apartment, consisting of expenses for its construction (10%) and the location of the place (6%). The idea of evaluation the amount of tax according to the owner's income is the least popular among the group of financiy well-to-do respondents, with 27% support. Whereas the groups of financiy average and poor ones show 35-38% of support to the idea.

Among the measures aimed to limit the speculations in the real estate market, the most effective one, in the opinion of Russians, is adopting a higher tax for the second or third apartment. The percentage of this measure's supporters has increased within a year (from 28% up to 36%). At the same time the part of supporters of the criminal penalty for real estate speculations has declined (from 21% down to 14%). 9% of respondents support the idea of prohibiting buying of second or third apartment. There is also a considerable amount of those who think the government should not take any measures since this is a normal market situation (18%) or that these measures are useless (13%).

All-Russia opinion poll was conducted by VCIOM, March, 31, 2007 - April, 1, 2007. 1600 respondents were interviewed in 153 population centers of 46 regions of Russia. The statistical error doesn't not exceed 3.4%.

 

Real estate tax practicy does not depend on quality and market price of the real estate today. Do you think it is fair?

 

Total respondents

Wealth status

Very good, goodAverageBad, very bad
Yes, I think it is fair13171310
No, I do not think it is fair68686967
Difficult to answer19151823
There is a suggestion to collect real estate tax, evaluated on the basis of the market price of the real estate. I.e., the higher the market price of the real estate is, the higher is the tax. What do you think of this suggestion?

 

Total respondents

Type of settlement

Moscow and St PetersburgMore than 500 thousand residents100-500thousand.Less than100thousand.Villages
Very positively151410111917
Somewhat positively325234343027
Somewhat negatively231228272522
Very negatively141015121514
Difficult to answer161213161120
What do you think should be a basis for real estate tax estimation?

 

Total respondents

Wealth status

Very good, goodAverageBad, very bad
Total metric area of an apartment (a house)10161010
Real estate quality30293031
Real estate location6666
Income of real estate owners35273538
Book value of an apartment, consisting of expenses for its construction1014117
Difficult to say9979
It is considered that one third of new real estate in major cities is bought for later leasing or resale. What do you think the government should do about it?
 2006.2007.
Adopt a ban, prohibiting the buying of second or third apartment129
No measures should be taken; it is a normal market situation.1718
Adopt a higher tax for the second or third apartment2836
No measures should be taken; it is useless1313
Adopt a criminal penalty for real estate speculations2114
Difficult to answer910
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