The Administration Of Taxation Clarifying 8 Problems Of Land Value-Added Tax Liquidation

Following the clarifying of the collection of income tax on real estate enterprises recently, the State Administration of Taxation announced yesterday the notice on the issue of liquidation of land value-added tax (hereinafter referred to as the notice), which seems to be a more stringent management of real estate development enterprises.

The notice requires 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 will be recognized according to the amount of the invoice. If the invoice is not issued or the invoice is not fully issued, the sales amount and other proceeds contained in the sales contract signed by the two parties shall be recognized.

Wang Surong, a professor at the International Business School of University of International Business and Economics, pointed out that the liquidation issues mentioned in the above notice were more specific and clear than before, and intended to strengthen the management of real estate development enterprises and enhance the intensity of tax investigation.

Some experts estimate that between 2005 and 2009, the loss of land value-added tax amounted to 2 trillion and 520 billion yuan.

The loss of land value-added tax, which has a direct impact on the real estate market, has also aroused the experts' call for comprehensive liquidation.

Wang Surong also said that yesterday's "notice" is not all new regulations, but real estate development enterprises in the past have not been strictly enforced, this time the document is easy to omission of the problem is further clarified.