Analysis On The Effect Of House Prices Regulation By Tax In China

With the high speed development of real estate economy, the realestate industry has already become our country’s important economypillar. But in recent years China’s real estate market appear the localizedoverheating phenomenon and high prices, the phenomenon have causedserious effects to our country’s people’s livelihood and social economy.From the tax regulation policy which has already appeared, the controldid not achieve the desired effect. This paper studies the relationshipbetween the real estate tax and housing prices, analyzes the existingproblems in China’s real estate tax system, and explores how to improvethe real estate tax.On the basis of the domestic and foreign correlation literature, thispaper introduces the basic concept of the real estate prices and tax, andexpounds the theoretical basis of tax regulation on control prices. On thisbasis, foreign countries’ experiences of the tax regulation on prices havebeen summed up. It includes that the measures should to follow theprinciple of flexibility, the establishment of real estate appraisal system,the real estate tax as the main source of local finance income. Then thepaper introduces the real estate tax system evolution, developmentsituation and regulation policy, and comes to conclusion that the realestate tax system has unreasonable tax system structure, has too many taxes and so on. These problems lead to the poor effect in house prices.In order to analyze the effect of China’s real estate tax regulation onhouse prices, this paper adopts the real estate tax and prices data of1988to2011to study, use ADF test, cointegration test and causality test modelof Grainger to the test. Test results show that the real estate tax has helong-term stable equilibrium relationship with house prices, the effect intheir long-term is more than short-term, and the real estate tax have aone-way relationship to house prices. On this basis, this paper makes ananalysis of the real estate industry several major taxes on the regulation ofhouse prices, thinks that land value-added tax can effectively reduceprices, property tax has more significance on symbolic than real and soon.Finally, in previous research result, this paper puts forward the realestate tax should follow the principle of price regulation, and somesuggestions of China’s real estate tax regulation. Then this paper putsforward some advice on the real estate links of development, negotiableand maintain.