Property Tax Levy And The Real Estate Market

China's real estate market witnessed a drastic boom since the end of the free housing distribution policy in 1998. With a cheerful development potential and boosting many relative industries, the real estate industry has soon become one of the vital industries in national economy. But a number of problems gradually loomed along with the rapid growth of real estate industry, including the expensive state-owned land rents, real estate taxation defects, ineffective monetary policy and unsuccessful protection to the arable lands. The rapid price promotion of real estate is the most server problem. Owing to that problem, citizens are dissatisfied by the ineffective macro-policies, many of them turn to property tax for solutions. In fact, they regard the property tax as the key to control real estate market. Authorities often discuss the tax, and it was even written into the documents of the central government. However, neither supporters to property tax nor its opponents fail to figure out what on earth the real estate market will be affected by the property tax, although they've given many viewpoints. Under this circumstance, the thesis discusses the possible effects to the real estate taxation system and land/money macro-policies.This thesis consists of two parts: theory and practice. For theoretical part, it regulates some basic definitions and introduces two biggest theory groups: the Benefits View and the New View. The properties of these two views offer an important reference to our upcoming property tax. For practice part, the thesis firstly gives a briefing on the international experience on property tax reforms and analyzes three types of property tax policies before pointing out the possible choice for China. Secondly, the thesis details the history revolution of China real estate taxation in the past and the characters and defects of the current real estate taxation. It also reveals the possible help by property tax to this real estate taxation. Also, the backgrounds, effects and limitation of the two major macro-economic policies, land policy and monetary policy are introduced. The property tax's possible supplement to these two macro-economic policies is discussed too. In the end, the thesis draws these conclusions: property tax can supplement China's real estate taxation, make land policy more effective, but neither property tax nor monetary macro-economic policy can help to reduce the real estate prices.