Research On Improving Taxation System In Real Estate Of China

China has always laid emphasis on the establishment and improvement of taxation in real estate sector, especially in the early period of reform and open-up and under the economic system in which the state and collective ownership occupies most economic sectors whereas individual economy exists as the assistance, the taxation system in Chinese real estate sector has played a positive role of adjustment in the development of national economy. But with the continuously deepening economic reforms and the development of real estate market, especially after the implementation of paid transfer and sell-out of state-owned land use right, the proportion of land ownership and house ownership owned by different units, especially by individuals have had new changes. Thus the existent taxation system on real estate sector has no longer met the need of directing practices in real estate taxation in China.Real estate falls into special industries. The factor of land in real estate development is monopolized and priced by the local government, thus it is basically not marketized whereas the sales of architectural materials and commodity property is completely marketized. In such condition, an overwhelming majority of cost of real estate developers is determined by non-market factors, but the profit is determined by the relation between supply and demand. Such phenomenon results in that the land development has a dual character: limit supply of land directed and planned by the government and market supply of land transfer and housing sales, thus the price of land appears scissors difference which tends to cause an overheating real estate supply. In view of this, the state has to resolve this special conflict between the supply and demand in real estate business by means of macro-adjustment to enhance the healthy and rapid development of real estate industry. Therefore it is necessary to sort out carefully and make a scientific definition of existent taxation theories of real estate sector so as to suggest a theoretical framework which is able to systematically and completely explain the taxation practices in Chinese real estate sector and provide theoretical ground to the taxation practices in real estate business.Targeting at Chinese real estate sector as well as the development status in quo of the taxation system in real estate sector, this paper in research mainly combines the outcomes achieved by domestic and foreign scholars on the research of real estate taxation system with the new trend of the development of real estate industry in a new background so as to realize the unity of practices and theories. First of all, it introduces the basic concept, theoretical ground as well as the important role real estate industry plays in Chinese national economy which provides a basis for the research of this paper. Secondly, it analyzes the outline of Chinese real estate taxation system and the existing problems. The main problems with Chinese real estate taxation system include the inconsistency between internal and external taxation of real estate, unreasonable taxation structure; the sever phenomenon of repeated taxation; a narrow taxation scope together with a wide scope of taxation-free; unreasonable tax base and tax rate in real estate sector; unreasonable distribution of taxation procedures with an excessively low tax in the owning procedure; the confused rent, tax and fee concepts in real estate sector and imperfect tax administration system and measures. Through analysis this paper lays the foundation for theoretical analysis and basis for historical reference to the improvement of taxation system in real estate sector. Thirdly, this paper makes comparative analysis over the practical results among different overseas countries so as to grab their characteristics: more emphasis on owning procedure and less emphasis on circulation in the design of tax types and the persistence in wide tax base, less tax types and low tax rate in taxation level. Fourthly, it suggests the principles to reform the taxation system in Chinese real estate sector: reasonable tax and to impose according to the capacity; positive tax, explicit rent and less fees; wide tax base, less tax items and low tax rate; clear taxation system; all of which are to boost the development of real estate industry. Fifthly, it raises recommendations to the policy in the innovation of real estate taxation system: uniform, simplified and regulated taxation system, to devise the structure of tax types scientifically and reasonably and pay attention to the coordination in the relations of real estate tax type reforms with other tax types or taxation systems; to construct and improve real estate taxation system, to impose property tax and strength the taxation in owning procedure of housing property; to define a tax and fee system scientifically, reasonably clear fees and amend taxes and reform the charging system of administration fees; to perfect the construction of relevant systems in the taxation of real estate sector.