The Influences of Property Tax System on Real Estate Prices－Study of The Reform of Prpoerty Tax System

• Main Authors: Cheng, Wei-Ying, 鄭維瑩
• Other Authors: Peng, Chien-Wen
• Format: Others
• Language: zh-TW
• Published: 2013
• Online Access: http://ndltd.ncl.edu.tw/handle/39810163153285690391

碩士 === 國立臺北大學 === 不動產與城鄉環境學系 === 101 === The primary objective of this study is to clarify the differences of the property tax systems between Taiwan and the major countries and to examine the effects of the change of the holding tax and transfer tax on the price of real estate. Furthermore, the study also examines the views held by different sectors on the property taxation system, measures taken by the government to curb the housing price and the direction of future tax reform. These are intended to design adequate property tax mix and proper tax reform measures to curb speculations in the real estate market and the skyrocketing housing price. This study compiled and compared the property tax systems of different countries. The data shows that the real estate holding tax imposed by these countries is consolidated and paid with land and housing tax. The tax rate may be adjusted by the local governments in accordance with actual circumstances with great flexibility. The actual transaction price of sale of real estate or capital gains is the basis for calculation and varying tax rates are imposed depending on the length of holding the real estate and the number of real estate held. These measures can punish speculative behaviors, such as frequent transactions and holding on land and housing with no intention to develop. Next, according to the simulated analysis, the land market can better increase supply and reduce speculative demand through high holding tax and low transfer tax, which is more effective in achieving the reduction of land price. When real estate is held for one year, if the holding tax rate is raised by one fold, the land price will reduce by 0.1829%. When the transfer tax rate is increased by one fold, the land price will drop by 0.1662%. In terms of curbing the housing market price, it is more effective to increase the transfer tax for the short term. The raising of the holding tax is more effective for the long term. When real estate is held for one year, the increase of the holding tax rate by one fold will lead to the drop in the housing price by 0.2296%. When the transfer tax rate is raised by one fold, the housing price will drop by 1.1386%. In addition, the overwhelming problem of the property tax system is the serious misalignment of the tax base and the market price. As long as the tax base is adjusted to the market price, the effects of the increase in the tax rate on the real estate price will be significantly improved. To use the holding of housing for one year as an example, when the tax base is adjusted to the market price, the increase of the holding tax rate by one fold will lead to the drop of the land price from 0.2296% to 1.2108%. If the transfer tax rate increases by one fold, the drop of the land price will increase from 1.7688% to 5.7301%. In addition, according to the questionnaire survey, approximately 60% interviewees are in the opinion that to strengthen the property tax system is the first step to curb speculations in the real estate market and prevent the price of real estate from skyrocketing, and the percentage of interviewees in favor of the transfer tax reform is significantly higher than that of interviewees in favor of the holding tax reform. 82.2% interviewees believe that the actual transaction price should be used as basis for calculating real estate value increment and different tax mix should be adopted to curb different types of speculations. Moreover, there are mixed views on the effects of differences between places of residence, whether or not owning real estate and whether housing is self-owned on the property tax system and the direction of future reform. Therefore, it is recommended that different tax system designs should be applied to vacant land and the integration of land and housing respectively in the future. High holding tax and low transfer tax should apply to the land market while the tax mix of low holding tax and high transfer tax should apply to the housing market. Not only should the tax on capital gains from the sale of real estate be calculated based on the actual transaction price, but the local governments should also be given proper flexibility to impose higher tax burden on owners of more than one piece of land or house which is not for primary residential use so as to stop speculative behaviors in the real estate market which in turn curbs the rising housing price.