The State Administration Of Taxation Sets The Minimum Threshold For Land Value-Added Tax, Which Is Higher Than That In The West.

Following the announcement of the relevant issues concerning the liquidation of land value-added tax in May 26th, the State Administration of Taxation again issued the notice on strengthening land value-added tax administration in June 3rd.

The notice clearly pointed out that in order to give full play to the regulation function of the land value-added tax in the preliminary stage, it is necessary for all localities to adjust the current rate of levy. In addition to affordable housing, the rate of levy in the eastern provinces should not be less than 2%. The provinces in the central and northeastern provinces should not be less than 1.5%, and the provinces in the western regions should not be less than 1%.

The Levy of land value added tax refers to the income earned by taxpayers before the project is completed and settled, and the land increment tax can not be calculated according to the cost determination or other reasons.

It is noteworthy that the notice of this release clearly stated that land value-added tax is a powerful tool to ensure fair distribution of income and promote the healthy development of the real estate market. In this regard, industry experts said that by raising the land value-added tax rate and timely liquidation, to a certain extent, narrowing the profit margins of real estate development enterprises and the land two level market, the seller's profit margin. In addition, the practice of hoarding land or covering up for extra profiteering will also be suppressed.

The notice requires that the verification and collection must be carried out in strict accordance with the conditions prescribed by the tax laws and regulations. No unit or individual may arbitrarily expand the scope of the approved collection. Any unauthorized collection of the approved land value added tax shall be corrected immediately.

However, the requirement for the verification of land value added tax must be strictly determined according to the requirements of tax laws and regulations. In order to standardize the approved work, the rate of ratified collection should not be less than 5%. The provincial tax authorities should make a distinction between different types of real estate according to the local realities, and establish the approved rate.