People look at advertisements displayed at a property agency in Hong Kong, May 31, 2020. (ROY LIU/BLOOMBERG)

The Hong Kong government is considering suspending a plan that would have introduced a vacancy tax on new housing stock, the Transport and Housing Bureau said.

READ MORE: HK leader approves vacancy tax to cool property market

The reconsideration was prompted by community feedback and the state of the economy, a bureau spokesperson said. Hong Kong has been battered by last year’s social unrest and the coronavirus pandemic, with the government forecasting a contraction of as much as 8 percent.

The move to squash the tax would be a relief for property developers, who would have been subject to a hefty tax and jail time if they failed to sell new apartments

The move to squash the tax would be a relief for property developers, who would have been subject to a hefty tax and jail time if they failed to sell new apartments. Hong Kong had 44,890 vacant new homes as of late 2019, representing 3.7 percent of the city’s total stock, and a decrease from 2018’s 4.3 percent, according to government data.

The plan to tax vacant new homes was among Chief Executive Carrie Lam Cheng Yuet-ngor’s proposed policies to tackle the city’s sky-high property prices in 2018. However, the bill has yet to pass in the Legislative Council.

ALSO READ: Vacancy tax may not be a sustainable fix

Despite a recession, home sales in Hong Kong remain buoyant. A new residential project with accessible transportation was oversubscribed by more than 50 times this week, making it one of the most popular apartment sales in the city in over a decade.