A Study On Countermeasures Required To Improve Real Estate Tax In China

House has been the most important property for citizens in any country as it isnot only closely related to the harmony and happiness of each family, but also hasfar-reaching influence over the country’s economy development in the long run.Overrecent years, along with the rise and development of China’s real estate market, thereal estate industry has gradually become one of the leading industries that advancethe national economy growth, playing an important role in the country’s economy andsocial development. However, what follows is the constant increase in price,associated with the warming up of real estate market. Issues such as the widespreadspeculating on real estate have become the focus of public opinion in China. However,a number of issues, including too narrow scope to levy and unreasonableness in termsof the tax calculating basis, have seriously restricted the institutional functions itought to have, upon reflecting on the existing real estate tax system in China. In thisregard, how to improve our real estate tax system is a question worth to be discussedfurther.In this paper, following a way of thinking, which is to find the problem and thensolve it, the writer has put forward personal suggestions on improving the country’sreal estate tax system after having made a thorough study on the country’s existingreal estate tax system.Introduction section of this article has briefly summarized current status of thecountry’s real estate tax system, as well as the important significance of real estate taxreform on our tax reform.Section1contains summary of relevant theories in relation to the real estate tax,in which, it has explored four issues covering the taxability analysis, the concept, thecharacteristics and the effects of our real estate tax respectively. In this section, firstly,the writer has innovatively argued for the taxability of our real estate tax, thus to pavethe way for its reform in the future.Section2narrates the historical evolution and current condition of our real estate tax, in which, by setting the founding of new China as the division line, the writer hasintroduced its historical development and evolution before and after the founding ofnew China respectively. Moreover, the writer has introduced the country’s real estatetax system before and after tax reform by taking into account of the ProvisionalRegulation on Real Estate Tax and Provisional Measures for Pilot Reform on RealEstate Tax as adopted by Shanghai and Chongqing.In section3, the writer has concluded into four points of excellent experiencebelow through studying on the real estate tax systems in four countries including US,UK, Canada and Singapore. Firstly, the tax design system for real estate tax ischaracterized by the lack of balance between “emphasizing possession and neglectingcirculation”; secondly, a principle of taxation featuring wider tax base and fewer taxcategory; thirdly, the division of tax authority over real estate tax collection, which isconsisted by local tax and the system of tax distribution; fourthly, a completesupporting facilities for the collection of real estate tax.In section4, the writer has deeply explored current legal issues concerning thecountry’s existing real estate tax system, wherein the legislation absence and lack ofjustification are the main problems faced by the real estate tax collection systembefore tax reform, while the lack of legitimacy and rationality are the main problemsfaced by real estate tax collection system after tax reform. Also in this section, thewriter has conducted legal analysis on whether or not we can levy real estate tax onhouses with limited property rights, thus it is argued that under the country’s existinglegal system, not only can we levy real estate tax on it, but also we should do so.As for those issues mentioned above, the writer has put forward personalsuggestions on improving the country’s real estate tax system through literatureresearch and field investigation while in combination with the hands-on experiencegained by engaging in tax-related work.