OVERVIEW OF CHINA'S CURRENT TAX SYSTEM
Farm Land Occupation Tax
(1) Taxpayers
Taxpayers are enterprises, units, individual household businesses
and other individuals (except enterprises with foreign investment,
foreign enterprises and foreigners) who occupy farm land for
building construction or for other non-farm purposes.
(2) Scope and tax payable per unit
This tax is imposed on all State owned and collectively owned
crop-planting land, and also on newly developed wasteland, fallow
land, land for rotation of crops, land for rotation of grass
and crops.
Different ranges of tax per unit are specified for different
regions in consideration of the average size of farmland occupied
per person and the local economic situation. The annual amount
of tax payable per square meter is: taking county as the administrative
region for calculation (hereinafter the same), 2-10 yuan for
county with one mu or less of farmland per person; 1. 6-8 yuan
for county with 1-2 mu farmland per person; 1.3-6.5 yuan for
county with 2-3 mu farmland per person; and 1-5 yuan for county
with more than 3 mu farmland per person. The amount of tax payable
per unit may be raised for Special Economic Zones, Economic
and Technological Development Areas and regions of developed
economy and tiny average size of farmland per person.
In order to avoid the big gap between neighboring regions, the
Ministry of Finance has assessed the average tax per unit for
provinces, autonomous regions and municipalities at provincial
level, which ranges from 2.5 to 9 yuan.
(3) Computation
This tax is based on the area of farm land actually occupied
by taxpayers and by applying the specific applicable tax per
unit, and paid in lump-sum. The formula for computing the tax
payable is:
Tax payable - Area of farm land actually occupied by taxpayer
× Applicable amount of tax per square meter
(4) Major exemptions and reductions
a. Exemptions may be given on land for military facilities;
land for railroads and airports; land for schools and hospitals;
land for farm irrigation facilities; no larger land for construction
of new houses than the old house in countryside, where the land
has been turned into farm planting; land for settling immigrants
due to reservoir construction, victims of calamity or refugees.
b. Tax reductions or exemptions may be given on land for construction
of new houses for countryside residents; revolutionary martyr's
family, handicapped revolutionary military servants, widows
and orphans in countryside and peasants living a difficult life
in old revolutionary base areas, minority nationality areas
and far remote mountain regions who build new houses within
the stipulated standards of land use and who have real difficulty
in paying the tax; welfare factories set up by Civil Affairs
Department for settling the employment of the handicapped; and
land for construction of motor roads. |
