Beijing is to introduce a property tax in two Chinese cities, the latest measure aimed at preventing a housing market bubble.

The State Council said on Thursday that the long-awaited tax would be introduced as a trial in Shanghai, the country’s business capital, and in Chongqing, a large city in the centre-west of the country.

“It’s impossible for housing prices to fall overnight because of the property tax, but it will help to curb speculation in the housing market,” Huang Qifan, the mayor of Chongqing, said.

Further measures to cool the market were announced on Wednesday, including higher down-payments and restrictions on the number of houses residents can buy.

Faced with rising political pressure from those shut out of the market, the government has been battling to control house prices since April, when it introduced limits on speculative purchases of apartments. The measures have restricted price increases but have not produced the drop in prices that some officials had hoped for.

Beijing has long discussed introducing a property tax, to be paid every year by homeowners, as a way to discourage speculation.

The idea has strong support among Chinese academics who also see it as a potential, but partial, solution to the chronic financing problems that local governments face. A property tax could provide some of the revenue local governments need to begin offering more education and other benefits to the tens of millions of migrant workers who have moved from the countryside to cities.

However, given the large number of apartments that are believed to be empty and held purely for investment purposes, some local officials fear the introduction of a property tax would lead to a sharp fall in the market as increased costs encouraged investors to dump holdings.

As a result, the tax will be introduced gradually, with each city allowed to set its own rate.

Chongqing said it would charge a tax of 0.5 per cent of the property value for houses between two and three times the market average, and 1 per cent for properties more than three times the average. Shanghai said it would charge 0.6 per cent on second homes.