Research Of China's Real Estate Possession Tax Reform

With rapid development of China's real estate market during these twenty years, the real estate industry has now played quite an important role in our country's economic development. However, this industry is special in that its sustainable development needs the government's proper interference, while real estate tax is just a main policy tool that the government could use to control the real estate market.Firstly, our country's real estate tax system has problems of high tax burden on circulation but low tax burden on possession. Furthermore, our country's real estate possession tax has drawbacks in both the division of the taxation power and the design of the tax system, which results that the local fiscal revenue can't achieve a sustainable growth; the fair functions of adjusting the wealth's distribution and taxing by wealth are weakened; efficiency of real estate resource's distribution and its taxation is affected. Hence, reform of our country's real estate possession tax should become the focus of the whole real estate tax system. To accelerate reforms of our country's real estate possession tax has great meanings for improving our country's tax system, strengthening local public finance and promoting real estate market's healthy development.Based on the successful practices of foreign real estate possession tax, our country's real estate possession tax reforms should go towards the goals of efficiency, fairness and revenue, gradually achieve the unified and standard pattern of property tax and meanwhile levy on the vacant fields. In addition, to coordinate with the tax reform, our country should well prepare the jobs of merging relevant real estate taxes and charges, properly dividing the taxation power, real estate evaluation, tax propaganda and collection, etc.