The Regulation Of Property Market Will Be Implemented Again, And Land Value-Added Tax Will Be Strictly Liquidated.

The State Administration of Taxation promulgated the "notice on the liquidation of land value-added tax" on 26 th, and clarifying some tax issues in the liquidation process of land value-added tax.

Experts pointed out that in the "new country ten articles" and all the rules mentioned that it is necessary to increase the liquidation of land value-added tax, the publication of the notice means that the liquidation of land value-added tax is strictly enforced.

The circular pointed out that when the land value added tax was liquidated, the invoice for the sales of commercial housing was issued in full, the revenue should be recognized according to the invoice amount. If the invoice was not issued or the invoice was not fully issued, the sales amount and other proceeds of the sales contract should be recognized.

If the commercial housing area in the sales contract is not in conformity with the actual measurement area of the relevant departments, it is necessary to adjust the land value-added tax before the liquidation has been made before or after the liquidation.

In order to narrow the tax avoidance space for developers, it is clear that the interest expenses incurred in the financial expenses of the development enterprises can be deducted in real terms if they can be assessed on the basis of the pfer of real estate projects and provided by the financial institutions, but the maximum amount should not exceed the amount calculated by the commercial banks in the same period. The cost of development can not be accounted for within 10% of the sum of the amount paid for obtaining the right to use land and the cost of real estate development.

Other real estate development expenses shall be deducted within 5% of the sum of the amount paid for land acquisition right and the sum of real estate development cost.

In accordance with the existing Interim Regulations on land value increment tax, land value-added tax is based on land and buildings on the ground, with value-added tax as the base, and according to 30%-60%'s four level super progressive tax rate, it is a combination of pre tax and liquidation.

The levy was introduced in 1994. However, due to the low rate of levy, many housing enterprises have postponed liquidation in various ways after meeting the liquidation standards. The land value-added tax has not been able to give full play to the role of regulating land value-added returns.

By the end of 2006, in the face of soaring housing prices, the State Administration of Taxation issued the notice on the management of land value added tax liquidation of real estate development enterprises, demanding that the land value-added tax be fully liquidated from February 1st next year.

The notice also listed seven kinds of requirements and the requirements for land value-added tax liquidation, including the developer's overall pfer project, the direct pfer of land use rights, the sales rate of the project has reached 85%, and the project has not been sold in three years.

But then the financial crisis broke out, and this policy was not strictly enforced.

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The notice can be said to be a supplement to the notice issued at the end of 2006, that is to say, the notice issued in 2006 is still applicable.

"Strictly implementing the land value-added tax policy can inhibit the profiteering of the real estate enterprises to a certain extent."

Zhao Xiao, a professor at the school of economics and management of University of Science and Technology Beijing, thinks that land value-added tax will significantly increase the tax cost of enterprises, reduce the profit level of Housing enterprises, and reduce the enthusiasm of Housing enterprises.

The idea of regulating the real estate market through the liquidation of land value-added tax is becoming clearer.

After the "new country ten articles" and all the rules mentioned the need to increase the liquidation of land value-added tax, the State Administration of Taxation issued a notice on the issue of land value-added tax liquidation on 26, clarifying some tax issues in the liquidation process of land value-added tax.

Experts pointed out that the land value-added tax will be combined with land and credit policies and measures to form a combination of real estate regulation.

Land value-added tax was introduced in 1994. However, due to the low rate of levy, it has not been able to give full play to the role of regulating land value-added returns.

In the current round of real estate regulation, land value-added tax has once again entered the public view.

In April, the "ten new countries" pointed out that the tax authorities should strictly follow the tax law and relevant policies and regulations, conscientiously do a good job in the collection and management of land value-added tax, and focus on liquidation and inspection of real estate development projects that are priced too fast or too fast.

Subsequently, Chongqing and other places have introduced regulatory detailed rules and regulations, and also mentioned the need to tighten up the land value-added tax liquidation.

The circular points out that when the land value added tax is liquidated, the invoice for the sales of commercial housing has been issued in full, and the income must be recognized according to the invoice amount. If the invoice is not issued or the invoice is not fully issued, the sales amount and other proceeds of the sales contract shall be recognized.

If the commercial housing area in the sales contract is not in conformity with the actual measurement area of the relevant departments, it is necessary to adjust the land value-added tax before the liquidation has been made before or after the liquidation.

In order to reduce the space for developers to avoid tax through falsification of development costs, the notice clearly states that the interest expenses incurred in the financial expenses of the development enterprises can be deducted according to the real estate projects calculated and assessed by the financial institutions, but the maximum amount can not exceed the amount calculated by commercial banks in the same period of interest rate. If the financial institutions can not provide proof, the development cost will be deducted within 10% of the sum of the amount paid for land use rights and the cost of real estate development.

Other real estate development expenses shall be deducted within 5% of the sum of the amount paid for land acquisition right and the sum of real estate development cost.

All use of their own funds, without interest expense, shall be deducted according to the above method.

In addition, the notice also clarified the deduction of the quality tax, the cost of resettlement housing, the land idle fee and the deed tax.

At the end of the notice, it is pointed out that after the taxpayer has paid the land value added tax in accordance with the regulations, the land value-added tax paid by the liquidation shall not be added to the late payment within the time limit prescribed by the competent tax authorities.

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In fact, in the last round of soaring housing prices, the authorities issued a land value-added tax liquidation of this measure.

At the end of 2006, the State Administration of Taxation issued the notice on the liquidation of land value added tax in real estate development enterprises, and demanded that the land value-added tax be fully liquidated from February 1, 2007.

There are seven kinds of requirements and the requirements for land value-added tax liquidation, including the developer's overall pfer project, the direct pfer of land use rights, the sales rate of the project has reached 85%, and the project has not been sold in three years.

But then the financial crisis broke out, and this harsh policy was not implemented.

The notice issued here is clear about the details to be paid attention to in the liquidation of land value-added tax, which is not in conflict with the notice issued by the State Administration of taxation at the end of 2006. That is to say, the notice issued by the State Administration of Taxation in 2006 is still applicable.

The "new country ten" has used land value-added tax liquidation as one of the tax control policies. Subsequently, all localities have followed up. In the local rules, they indicated that we should step up the liquidation of land value-added tax.

Why in this round of real estate regulation, the land value-added tax liquidation will precede the taxation of housing tenure and become a sharp weapon for regulation and control?

Experts pointed out that this is mainly determined by the current tax system, because the tax system of land value-added tax is relatively perfect, as long as the collection and management can be strengthened, while in the Housing Preservation tax, involving the amendment or legislation of the regulations, it still takes a certain time from the procedural perspective.

In addition, land value-added tax should be effective in regulation and control.

In April, the China economic research group of University of Science and Technology Beijing called for the Levy of land value added tax to curb the new round of the property market bubble, and pointed out that: strictly collecting land value-added tax can inhibit the real estate enterprises' huge profits and play a role in regulating the income distribution to a certain extent. It can effectively control the overheated investment in the real estate market, reduce the impulse of real estate enterprises and raise the risk awareness of the real estate enterprises; it can effectively regulate the structure of the real estate market and guide the real estate enterprises to increase the supply of ordinary housing.

The study group believes that the land value-added tax policy requires direct pfer of land enterprises to liquidate the land value-added tax at the time of paction. If the liquidation policy is strictly implemented, the profit margin of the seller in the two tier land market will be greatly reduced.

In addition, the additional revenue from land hoarding or covering up is 60% of the land value added tax, plus the cost and opportunity cost of hoarding or covering up, which may make developers hoarding into a profit free situation.

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Liu Huan, vice president of the tax School of Central University of Finance and Economics, also believes that by increasing the rate of land increment tax and timely settlement, the profit margins of real estate developers can be narrowed to a certain extent.

Zhao Xiaoze, a professor at the school of economics and management of University of Science and Technology Beijing, believes that the strict collection of land value-added tax is not necessarily effective in controlling the rise in housing prices. To control the excessive rise of housing prices, we should fundamentally solve the contradiction between supply and demand.

As for the concern that land value added tax may be pferred to consumers, Zhao Xiao thinks that land value-added tax is only cleared after the sale of real estate projects has been completed or at least 85% or more. Therefore, this tax is not the same as the turnover tax of real estate development tax and so on.

What is land appreciation tax?

Land value-added tax is designed for excess profits of real estate projects, which is intended to regulate land value-added returns.

In accordance with the current Provisional Regulations on land value increment tax, land value-added tax is based on land and buildings on the ground, and the value-added tax is the tax base. The tax rate is levied at the rate of four grade super progressive tax rate, and the tax rate is between 30%-60%.

The levy was introduced in 1994. However, due to the low rate of levy, many housing enterprises have postponed liquidation in various ways after meeting the liquidation standards. The land value-added tax has not been able to give full play to the role of regulating land value-added returns.

With the advance of the property market regulation, the main financing channels such as bank loans, capital market financing and sales returns have been blocked. Housing companies have begun to replenish funds through more channels such as trust, bills, private financing and overseas loans.

Analysts believe that the financing of these means is limited, with the continued regulation, housing enterprises financial pressure gradually increased.

The latest report released by the China Index Research Institute shows that the growth of capital sources of China's real estate enterprises has slowed down this year.

In the first 4 months, the number of real estate companies granted by banks is very limited, and the total amount is not more than 50 billion yuan.

In the whole year of 2009, commercial banks provided more than 330 billion yuan of credit to real estate enterprises.

Wang Ren, an international real estate analyst at Jiayin bank, said that the ratio of bank loans to developers often exceeds 1/3, which is the most important financing channel for most developers.

Under the background of credit contraction, the pressure of some developers is self-evident.

On the other hand, the financing of the real estate enterprises in the capital market is also facing some difficulties.

According to statistics, as of the end of April this year, only Zhong Jun real estate (market, information, commentary) a real estate business successfully listed in Hongkong, China. So far this year, the A share market has not been approved by Real Estate Company.

The refinancing of listed housing companies has also been strictly controlled.

Since October 2009, the SFC has increased the link of the opinions issued by the Ministry of land and resources in the process of auditing the IPO and refinancing of real estate enterprises.

After bank loans, capital market financing and other channels were blocked, housing companies began to finance through a variety of ways to ease financial pressure.

Since 2010, major housing companies such as Hengda, agile, Jindi and Longhu have expanded various channels of financing such as priority notes, fund raising and overseas financing.

This trust financing channel is also more and more favored by housing companies.

Recently, Greentown China (market, information, commentary), Chinese enterprises (600675), new town real estate and so on have borrowed trust to achieve financing.

This year, some areas have begun to strengthen the collection and management of land value added tax on real estate development enterprises.

Many developers and insiders told reporters that the clarifying details of land value-added tax liquidation by the State Administration of taxation may mean that the relevant work will be further intensified, which will undoubtedly make the cash flow of developers who are not ready to tighten quickly.

"In the case of a sharp drop in property market volume, land value-added tax liquidation is a plus for developers."

Fan Xiaochong, executive vice president of Beijing sunshine 100, said.

He told reporters frankly that if local governments strictly enforce this policy, the cash pressure of developers will be greatly increased, and some unprepared small and medium-sized developers will be even more difficult.

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World Union real estate (002285) analysts believe that the liquidation of land value-added tax plus property tax may mean that future real estate regulation will be undertaken by taxation.

The strict collection of land value-added tax will increase the cost of developers' hoarding and covering up, and create pressure on the developers' capital chain, which will urge developers to increase their development efforts, adjust their development structure and speed up market supply.

Li Wenjie, managing director of Zhongyuan Real Estate North China, believes that the liquidation of land value-added tax will accelerate the drain of developers' cash, so some developers may have to choose a price reduction promotion to return the funds.

"The cost of developers may increase to some extent to consumers, but the rules of Beijing and other places have pointed out that the scope of liquidation and inspection is too expensive or too fast, and it seems that the main purpose is to suppress high prices."

World Alliance Real estate analyst said.

Earlier, relevant departments in Guangxi, Henan, Xiamen, Chongqing, Beijing and other places have gradually introduced measures to require enterprises to carry out land value-added tax liquidation within the prescribed time limit. Some have also increased the rate of land value-added tax levy and changed the approved levy to audit collection.

Tianxiang investment analyst said that property sales were hot last year, and developers had plenty of capital in early 2010, but this situation may not last.

"The impact of the developer's capital chain, in addition to the progress of sales reimbursement and take place, there is a follow-up government policy on the management of the developer's capital.

If the government strictly requires developers to manage the pre-sale accounts for special account, and only to pay for the project payment, that is, developers can no longer occupy construction contractors' projects. If developers do not get them, there may be a tight financial situation in the three quarter.

It should be said that in the current overall environment, investors' concerns about the market mainly come from regulatory policies, rather than worrying about the overall overvaluation of the market, or the expected decline in profits of listed companies.

However, with the recent spread of the European sovereign debt crisis, European stock markets have fallen below the line of ox and bear.

This event has pushed forward subtle changes in domestic macro control policies, which has led to a rebound in A shares. In this process, real estate stocks with the strongest response to macroeconomic policy are expected to become the pioneers of the rebound.

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Growth or restructuring depends on the external situation

Why has the peripheral market slumped recently and the A share market has been relatively strong?

I think the logic is clear.

This is a period of time when European and American stock markets are rising and the reasons for the adjustment of A shares are the same.

Because China chooses to maintain growth or adjust its structure, the key lies in the economic operation of Europe and the United States.

Specifically, if the situation in Europe and the United States is very good, China will take advantage of this opportunity to adjust its economic structure.

In fact, in the past two or three years, China's macro policies either choose to maintain growth or choose to adjust its structure.

In a period of time, the government may spend more energy to protect growth, and in the meantime, it will spend more energy to adjust its structure.

The pformation node is to observe the operation of the European and American economies. If the situation is too bad, we must ensure growth, because exports will certainly be bad; otherwise, if the situation in Europe and the United States improves, exports will be guaranteed, so we can let go of the restructuring.

Looking at the present, most of the European and American stock markets are below the annual line, and the sound of the two bottom is endless.

Senior leaders pointed out clearly last week that we should prevent the superposition of negative effects.

At this point, it should be said that the situation has been basically clear, that is, the government may re adjust the intensity of macroeconomic regulation and control policies.

The direction must be relaxed, but how much to relax depends on the economic operation of Europe and the United States.

Since last week, the macro-control policy should have entered a new era, which corresponds to last July.

During this period, the probability of reverse operation between European and American stock market and A shares is greater.

Of course, the premise is that there is no super financial tsunami in Europe and the United States.

Since the policy adjustment is clear, who will react most strongly to it?

Undoubtedly property.

In the April analysis, the author clearly pointed out that real estate stocks may see the intermediate base in April or May.

Now I think the intermediate bottom has been formed this week, and the real estate stocks in the future may ushered in two to three months of rebound.

If we look at it for ten years, China's real estate stocks will be a very rewarding sector.

First of all, the real estate stocks have a short-term rebound, which means that the real estate stocks are faced with a chance to clear the regulatory policy.

From a historical perspective, real estate stocks tend to perform well under such a background.

Of course, we should look at the future of China's real estate stocks in the long run.

There is no doubt that no matter official or private, there is no doubt that there is a huge demand for housing in China.

At the end of last year, the author estimated that the potential demand for housing in China was 10 billion square meters. The latest research result of China gold is that China's potential demand is 18 billion square meters.

This means that the production of 700 million square meters per year will take 25 years to complete.

From the long-term operation of housing prices, it must be directly proportional to GDP growth and per capita income growth. Therefore, in the long run, the rise in housing prices is also unquestionable.

Taking into account the current and future policies will lead to a substantial increase in the concentration of developers in the future, which will increase the chance of existing developers to increase their share in the future.

With the above assumption, China's residential sales area will reach 1 billion 200 million square meters in 2020 and sales revenue will be 7 trillion and 800 billion (when the average price of the national commercial housing is expected to be 6500 yuan).

Assuming that the share of individual leading developers reaches 5%, it indicates that its sales revenue will be close to 400 billion yuan, and its market capitalization is generally at this level.

There will be no less than 10 companies in China's 100 billion market capitalization.

This means that the long-term prospects of the real estate industry are still promising.