29 Oct 2015
Real Estate Tax Likely to be Implemented in 2017
“Real estate tax” has been included in the legislative plan of the National People's Congress Standing Committee for this year. According to sources, the draft of real estate tax legislation has basically been completed and is currently soliciting opinions internally and undergoing improvement. The new real estate tax is likely to be a consolidated property tax and urban land use tax with the tax rate to be determined by local governments within a range set by the central government.
Minister of Finance Lou Jiwei revealed earlier that efforts will be made this year by the ministry to support the work of real estate tax legislation, quicken the pace of real estate tax legislation, and advance reform at the right time. In view of this, some experts predicted that real estate tax is likely to be implemented by 2017.
According to experts, real estate tax reform should take into consideration the reform of taxes and fees related to property and land, consolidating step by step tax items related to the existing property tax, urban land use tax, farmland occupation tax, deed tax and stamp duty, as well as certain reasonable government fees levied on real estate. By so doing, a real estate tax unifying relevant taxes in urban and rural areas and different taxes on property and land, as well as basically aligning with the real estate tax levied in other countries can be implemented.
People in the trade reckoned that Shenzhen and Guangzhou are expected to become the second batch of pilot cities after Shanghai and Chongqing to implement property tax reform.
Chongqing has been levying real estate tax on personal housing since 1 October 2015. This move has started people guessing whether real estate tax will be launched officially. According to the announcement made by the Chongqing local taxation bureau earlier, taxpayers meeting the requirements of paying real estate tax should, within the period from 1st to 31st of October, make a declaration to the local taxation department for paying real state tax on personal housing. Since 2011, the starting point for the payment of real estate tax in Chongqing has experienced four upward adjustments (based on the price of the property concerned), from Rmb9,941 per square metre at first to Rmb13,192 per square metre now.