| Shanghai and Chongqing have begun implementing the experimentalwork on imposing property tax on some specific types of properties since2011. This pilot work reflects the increasing demand for new source tomaintain fiscal balance of local governments along with the withdrawal ofland finance. However, under current tax and legal system the legality andrationality of property tax are being challenged. First, from the perspectiveof legality, promoting property tax by provincial level government hasviolated the legalism for tax as well as the regulation under authorizationmode of legislation in China that legislation right is held only by the StateCouncil of China and cannot be transferred to other administrations. Fromthe perspective of rationality, the original objective of adopting propertytax as a policy-oriented tool to control the real estate market has not beenwell achieved. Furthermore, there is a lack scientific equality consideringelements of property tax, such as taxable objects and tax basis.Relatively property tax system has been well established in developedcountries for many years and may be beneficial to compare it with thesecountries and utilize their successful experience into the establishment ofproperty tax system in China. This paper raises several recommendationsin basis of comparative study on property tax system in the United Statesand France, which consists of clarifying the purpose and nature ofproperty tax without violating the legality of legislations, establishing ascientific and systematic assessment and imposition mechanism byreforming tax basis, tax rate, and completing the incentive and exemptionpolicies. In summary, property tax should be taken from citizens and usedin the interests of citizens. |
