Chinese officials ditch luxury autos to raise revenues
China's economic slowdown has meant different things in different places. For the cash-poor city of Wenshou, it means getting rid of extra toys.
As the Financial Times reported, Wenshou city officials recently raised $1.7 million by selling 215 automobiles owned by the local government. Before 2012 comes to a close, local officials plan to sell an additional 1,300 vehicles, nearly 80 percent of the local fleet.
Wenshou is not the only city reducing its automobile fleet. Across the country, officials are paring back expenses, including standard-issue luxury automobiles. State media has been encouraging the sale of luxury sedans which cost the country an estimated $156 billion per year.
To officials like Tao Ran, an expert in local governance at the People's University of Beijing, the auctions are emblematic of financial duress. "It's a sign of the difficulties facing city finances," he told the Financial Times.
While city finances ballooned over the last few years, due in large part to the growing economy and rising real estate values (home values have increased by 50 percent in the last three years), falling home values mean a lower tax base -- and likely cheaper rides -- for many municipalities.
This post was originally published on Smartplanet.com