An Emprical Study On Property Tax Experimental Reform In Henan

In the process of fiscal decentralization reform all over the world, property tax become the breakthrough of tax reform, and many countries carried out the property tax reform with a focus on land and housing. With the development of China's real estate industry, personal housing and real estate price keep increasing and the relevant tax becomes an important source of revenue. However, the current real estate tax system can't meet with the situation. In 2003, China put forward a property tax reform, with a view to promote real estate's healthy development through property tax, increase the revenue, and to rebuild our country's tax system. The truth is that the property tax is still can't levy in the whole country after five years'pilot in 10 cities or province. The reason is that the interests of key stakeholders involved in property tax reform are difficult to adjust.This paper, based on the literature, expounded the meanings of tax and property tax and reviewed and gave a brief evaluation of the three views of tax incidence, providing a theoretical support for further study. It made an analysis of China's current real estate tax system and its problems and explained the significance of property tax. According to the different stages of economic development, the paper selected representatives among OECD countries, developing countries and transition countries to introduce the reform and levy of the foreign property tax, and finally proposing some reference for China's property tax reform.In the empirical part, based on the adjustment of interests, the paper made a study of the effect of property tax on local government and main bodies in the real estate market. First, the paper analyzed of pilots'situation, simulation program, real estate market and related tax scale in Henan Province and pointed out that real estate industry's healthy development and improvement of living conditions provide a good tax base for property tax, tax revenues are an important source of local revenue. Next, using data from 1999 to 2008, we got an equation between property tax revenue and housing price by Eviews5.0, and made a forecast of the property tax scale in the next five years the revenue. The results showed that the property tax can become a major local financial source. Using DEA model, the tax efficiency is tested before and after property tax reform, the efficiency would decline after property tax introduction. So, land reform and the land transfer tax system design must be adopted to eliminate negative effects caused by uncertainty of land grant fee, making property tax revenue as local finance's steady source. In addition, this paper pointed out that the property tax levy will cause housing prices to decline in the short term, and that tax burden during maintain phase will increase in the long term. So, it could adjust the structure of housing demand and guide rational housing consumption though meeting self-occupied real estate demand and inhibiting investment and speculative demand. At the same time, this will reduce the risk in real estate investment and development, encourage rational investment, and improve effective allocation of real estate resources, finally contributing to real estate healthy development.