China’s system of levying taxes on real estate is complex and evolving. While a comprehensive, recurring tax on the value of residential property as commonly understood in many Western countries is not yet fully implemented nationwide, various forms of property-related levies exist. These include a pilot program for real estate tax in select cities, taxes on property transactions, and taxes on land use rights. For example, individuals selling a property are typically subject to a deed tax.
Effective taxation of real estate is considered a crucial tool for regulating the property market, managing local government finances, and potentially curbing speculative investment. A well-designed property tax system can generate stable revenue streams for municipalities, enabling investment in public services and infrastructure. Historically, land in China has been publicly owned, with individuals and corporations holding usage rights for a set period. The shift towards a more comprehensive property tax system reflects a significant development in China’s economic and fiscal policies.
