The house tax in China has a long history. Ever since the Tang Dynasty (AD618-907) there has been a tax on houses attached to land. However, being just one off many miscellaneous local taxes, the house tax has been levied by different standards and measures under different names, and was never enforced throughout the country until the early years of the ROC.
In 1943,the ROC government promulgated the House Dues Act, which prescribed that towns with 500 or more households were permitted to tax houses at a rate of no more that 5%of the value of the house, or, in the case of rental, the rent of the house, In 1950, the Act was amended to tax at different rates based on the status of the owner and the purpose for which the house was used, I.e., residential purpose by the owner, residential purpose by the tenant, business purpose by the owner, or business purpose by the tenant In 1955, the Act was again amended to expand the scope of taxation to houses attached to land and such other buildings which enhanced the utility value of there houses. In addition, it also made a 50% reduction available for plant houses directly used for the purpose of production in order to support the policy of encouraging the development of industry.
In 1967, the House Dues Act was amended. In this amendment the name was changed to the House Tax Act. In this amendment the name was changed to the House Tax Act. In addition, the following significant amendments were enacted:
- The house tax was levied according to the current value of the house; however, houses were still taxed at different rates based on the purposes for which the houses were used.
- The current values of the houses used to calculate the house tax were assessed by the real estate assessment committee and were publicly announced.
- The exemption and reduction provisions were written into the Act.
- Declaration procedures. Were established and a penal provision for failure to declare was also written into the Act to effect the enforcement and to increase the effectiveness of the procedures. In accordance with the law for governing the Allocation of Government Revenues and Expenditures, the revenue raised from the house tax goes to the local government, and is one of the most important financial resources for special municipalities and counties (or cities) In order to enforce it consistently among the counties and cities throughout the country, the Act has been enacted by the central government. However, each local government is permitted to have its own regulations, according to the various conditions in each country (or city), for enforcing the Act.
The house tax shall be levied on all houses attached to land and on such other buildings, which enhance the utility value of these houses.
- The house tax shall be collected from the house owner.
- Where a right of Dien exists, the house tax shall be collected from the Dien-holder.
- Where a house is jointly owned by more than one person, the house tax shall be collected from the joint owners who shall designate one of themselves to pay the tax on their behalf. In case no one is designated to pay the tax, the present occupant or user shall pay on behalf of the joint owner. In a case where the house tax paid by the present occupant or user exceeds the obligation he is to meet, be has the right to request the other joint owner to refund to him the excess amount he has paid.
In a case where the whereabouts of the house owner or Dien-holder referred to above is unknown, or if he is not domiciled in the locality where the house is situated, the house tax shall be paid by the manager or present occupant of the house.
In a case where the house is rented,
* According to the ROC Civil Code, Dien is a form of lease for a maximum period of 30 years or less. The Dien-holder takes possession of a person's real estate and has the right to use it and enjoy the income therefrom. the house tax shall be paid by the tenant and deducted from the rent payable to the owner.
C. Tax Rates
The house tax is one of the main resources of local governments. To balance the development of each county/city, the Act set up maximum and minimum rates, and left the actual rates enforced to be decided by the local government.
- The maximum and minimum rates-The house tax shall be levied according to the current value of the house at the following rates:
- For a house used for residential purposes, the rate shall not be lower than 1.2 percent nor higher than2.0 percent of its current value. In a case where the house is used for residential purposes by the owner himself, the rate shall not be higher than 1.2 percent of its current value.
- For a house used for business purposes, the rate shall not be lower than 3.0 percent nor higher than 5.0 percent of its current value. In a case where the house is used a private hospital or clinic, a professional office or the premises of a non-profit civic organization, the rate shall not be lower than 1.5 percent nor be higher than 2.5 percent of its current value.
- For a house used for both residential and non-residential purposes, the house tax thereon shall be levied at the respective rate leviable on the area of a house for residential and non-residential purposes, provided, however, that the taxable area for non-residential purposes shall not be less than one-sixth of the total area of the house.
- The actual rates enforced-The house tax rates shall be fixed by the government of each county (or city) and submitted, after being approved by the local people's assembly, through regular channels to the Ministry of Finance for record. However, the provincial government considers that rates should be necessarily unified, so after being approved by the Provincial Assembly, they are sent to the Ministry of Finance for the record, In the case of a special municipality under the direct jurisdiction of the Executive Yuan, the municipal government may fix the tax rates and submit them, after being approved by the municipal assembly, to the Ministry of Finance for the record.
- The actual rates enforced in the Province of Taiwan, the City of Taipei, and the City of Kaohsiung are listed in the following table.
The actual rates enforced in the Province of Taiwan.
|Classification of Houses||Max.Rates||Min Rates||Actual Rates Enforced|
|Houses for residential purposes
|Houses for business purposes
|Houses for private hospitals, professional offices the premises of non-profit civil organizations.