Legal Thinking About Property Tax Levy

Real estate market in China has developed rapidly since 1990's, meanwhile, real estate industry has played a increasingly important role in national economy. In August 12 2003, Notice on Sustainable and Healthy Development of Real Estate Industry, which is enacted by State Council points out that real estate industry has been one of the leading industries of national economy. And real estate taxation has increased from 9.2 billon yuan in 2000 to 12 billon yuan in 2002; in 2003, real estate taxation has exceeded 13.4 billon yuan, which has become a new unneglectable taxation-increasing point. However, 13.4 billon yuan only amount to 0.67% of China's annual taxation income in 2003. This fact that the increase of real estate taxation lag far behind increase of value of realty tells us that current real estate taxation collecting system of China can no longer meet the needs of economic development and the goals to collect real estate taxation. The reason behind is that real estate taxation collecting regulations are mostly enacted tens of years ago and these regulations are not in conformity with China's current economic development.The sixteenth session of Communist Party of P.R.China the third round expressly points out that "undertake reform of urban construction taxation; if all conditions are realized, replace real estate taxation and other relevant fees with property taxation". Reform of real estate has been on high agenda. Taxation Collecting Regulation of P.R.China Article 3 stipulates that, "Colleting, reducing, exemption, refunding taxation and paying taxation evaded shall be undertaken pursuant to relevant laws". Consequently, reform of real estate taxation is reform on taxation-related laws and regulations. The author intends to have a primary study on real estate taxation by comparing legislation and taxation system of developed countries and regions. Some suggestions will also be proposed on reform of real estate law. Mainly concemed with legislative mode and system designing of realty taxation, this thesis will elaborate the subject from the following fourth chapters:Chapter one will analyze the characteristics and functions of property taxation, reasons to collect property taxation and legislative mode of property taxation. The author points out that collecting property taxation will benefit the perfection and regulation of property taxation system, reduction of the gap between the rich and the poor, optimally allocating resources, reasonably allocating burden of taxations, improvement of real estate industry.Chapter two will systematically study current real estate taxation system and objectively evaluate its positive impact and analyze problems arising from the current system. These problems include confusion of rent, taxation and fee, restriction of the scope of collecting, unfair burden of taxation, unreasonable basement of taxation, lack of law in real estate evaluation area, et al.Chapter three will review and compare the collecting system, legislative model and system designing of property taxation of United States, Hong Kong, and Taiwan. The author conclude that property taxation is the main source of local finance; it is based on the principle of "wide taxation base, few variety of taxation, low taxation rate" and is assisted with a perfect property taxation law and normative real estate evaluation system. All points listed above provide experiences and revelation for the legislation of China.Chapter four will elaborate the principles and assumptions of collecting property taxation. The author will discuss the legislative model and system designing of property taxation, affiliated system and policies shall also be discussed. The author holds the opinion that property taxation shall be designed with wide taxation base and low taxation rate, which conforms with its characteristic as a property taxation and measures such as coordinating taxation burden of real estate purchased, establishing a property taxation evaluation institution, enhancing real estate registration system, reasonably allocate property taxation shall also be taken to improve the realty taxation collecting system.In short, defects of current real estate taxation law need to be analyzed from the perspective of law. The author intends to make up such defects, which is also the innovative points of this thesis. This thesis has made a primary research on reform of real estate taxation and collection of property taxation, which the author wishes to arise further study and practice.