China's premier called for urgent steps to prevent economic overheating, 
state media said Thursday as the government forecast more double-digit growth in 
the next quarter, adding to pressure for new measures to avert a financial 
crisis. 
"We must take forceful measures to resolve prominent problems to prevent the 
economy's rapid growth from turning into overheating," Premier Wen Jiabao said 
Wednesday in a teleconference with officials nationwide, according to news 
reports. 
 
 
 |  A construction site is seen in Changsha, 
 Central China's Hunan Province in this file photo taken in May, 2006. 
 [Xinhua]
 | 
Wen, China's top economic official, told officials to "resolutely control" a 
boom in construction and bank lending that drove growth in the second quarter to 
11.3 percent, its highest rate in a decade, the People's Daily and other outlets 
reported. 
On Thursday, the government announced new taxes on real estate sales in an 
effort to discourage speculation. 
Chinese leaders want to keep economic growth high in order to reduce poverty. 
But they worry the investment boom could soar out of control, igniting inflation 
or leaving companies and banks with dangerously high debts. 
Growth should slow only slightly to 10.8 percent in the next quarter, 
compared with the same period last year, the government's main planning agency 
said Thursday. 
For the first nine months of this year, investment in factories and other 
fixed assets should soar by 28.5 percent, the National Development and Reform 
Commission said. That is close to the 29.8 percent growth rate reported in the 
same period of 2005. 
The government has tried to cool off the economy by raising interest rates in 
April and restricting construction and credit. Economists say another rate hike 
is possible, as is a rise in the value of China's currency, the yuan, which 
might restrain exports by making Chinese goods more expensive. 
The premier also called for more efforts to improve life for China's poor by 
ensuring stable growth of farming and other industries in the countryside, home 
to some 800 million people. 
The Communist Party of China announced last week that the annual meeting of 
its Central Committee in October will focus on building a "harmonious 
country" - a reference to efforts to ease tensions over the growing wealth 
gap between regions and social classes. 
Meanwhile, the government said it will start collecting a 20 percent capital 
gains tax on property sales beginning August 1. The tax agency said the measure 
was enacted in 1994 but has rarely been used. 
The agency said it would impose a separate tax of 1 percent to 3 percent on 
resales of residential property owned less than five years. 
The announcement on the agency's Web site didn't say how the new tax would be 
applied. China already charges a 5 percent tax on property sales after less than 
five years of ownership.