Article 1 These Rules are formulated in accordance with the provisions of Article 14 of the Provisional Regulations on Land Value Appreciation Tax of the People's Republic of China" （hereinafter referred to as the Regulations）。
　　Article 2 The "transfers of the use right of state-owned land， buildings and other attachments thereof" mentioned in Article 2 of the Regulations refers to the sale or other paid transfer of the real estate. It excludes the transfer of a real estate through inheritance or grant without charge.
　　Article 3 The "state-owned land" mentioned in Article 2 of the Regulations refers to land defined as such by the law.
　　Article 4 The "buildings thereon" mentioned in Article 2 of the Regulations refers to all buildings constructed on the land， including all kinds of the attachments thereto above and underground.
　　The "attachments" mentioned in Article 2 of the Regulations refers to all the immovable installations on land that would be destroyed if moved.
　　Article 5 The "returns" mentioned in Article 2 of the Regulations refers to all of the economic interests arising from the transfer of the real estate.
　　Article 6 The "institutions" mentioned in Article 2 of the Regulations refers to enterprises， undertakings， government institutions and social organizations and other institutions.
　　"Individuals" mentioned in Article 2 of the Regulations refer to individual business operators.
　　Article 7 The items deductible from the amount of land value appreciation in the assessment thereof as provided in Article 6 of the Regulations are specifically：
　　1. "Payments for obtaining the land use right" refers to the price a taxpayer pays for obtaining the land use right and other related charges he pays in accordance with the unified State regulations.
　　2. "Costs involved in land development， the building of new houses and auxiliary establishments （hereinafter referred to as realty value appreciation development）" refers to the actual costs incurred to a taxpayer in a real estate development project （hereinafter referred to as costs of realty value appreciation development）， including compensations on the expropriation of land and the resettlement thereof， the costs of the initial-stage engineering project， the costs of the building and installation work， charges on the infrastructure， charges on public utilities and indirect expenses in the land development.
　　The compensations on land expropriation and the resettlement thereof cover the charges on land expropriation， tax on the use of farmland for non-farming purposes， expenses on the resettlement of the labor power， net expenses on compensations for the removal of attachments above and underground， expenses on houses for resettlement， etc.
　　The costs of the initial-stage engineering project include all expenses involved in the planning， designing and feasibility study of the project and the hydrological and geological studies and surveys and the building of roads， water pipes and electric line and land leveling.
　　Expenses on construction and installation include those on construction and installation paid to the contractor and incurred on works done by the taxpayer itself.
　　Expenses on infrastructure includes those on all those engineering works of roads， the supplies of water， electricity， gas， sewage， drainage， telecommunications， illumination， environment， lawns and trees within the housing estate.
　　Expenses on public utilities include all those expenses incurred on those public utilities within the housing estate which cannot be transferred with compensation.
　　The indirect expenses on land development include those expenses involved directly in the organization and administration of the land development project， including the wages and welfare benefits of the workers， expenses on depreciation， repairs， office expenditure， water and electricity fees， charges on labor protection and the expenses amortized on houses for temporary use， etc.
　　3. Expenses on land development， construction of new buildings and auxiliary attachments （hereinafter referred as land development expenses） refer to those expenses involved in the marketing， management and financial matters related to the land development project.
　　Payments for interests in the expenditure on financial matters may be deducted in full against proofs provided by banking institutions as amortizations on the transfer of the real estate， but that shall not exceed the interests computed at the interest rate of the same type of loans and of the same terms issued by commercial banks. Other expenses on land development shall be deducted within the limit of 5% of the total sum as provided in （1） and （2） of this Article.
　　Interests that cannot be amortized on real estate transfer projects and against which no proofs are provided by banking institutions shall be deduced within 10% of the total sum as provided in （1） and （2） of this Article.
　　The specific ratios for the computation of the deductions cited above shall be defined by the people's governments of the provinces， autonomous regions and municipalities directly under the State Council.
　　4. The appraised price of old houses and buildings refers to the price appraised by a government-certified real estate appraisal institution at the time of the transfer of a used house and other structures on the basis of the replacement cost at a discount of the depreciation degree. The appraised price shall be subject to the confirmation by the local tax authorities.
　　5. The tax payments on the transfer of a real estate refers to the payments on the business tax， urban maintenance and construction tax， stamp tax. Payment for extra charges of educational funds that arise in the transfer of real estate shall be deemed as payment of tax to be deductible.
　　6. Pursuant to the provisions of （5） of Article 6 of these Rules， a taxpayer dealing in land development may be allowed an additional deduction of 20% of the total sum computed as provided in （1） and （2） of this Article.
　　Article 8 Land value appreciation tax shall be assessed by taking as the accounting units the most basic accounting items or objects in a taxpayer's real estate cost accounting.
　　Article 9 In the case of a taxpayer engaged in land development and real estate transfer by stages and installments after acquiring the use right of a large tract of land， the sum of deductible items thereof may be assessed on the basis of a proportionate amortization of the total area of the land use right or the floor space of the construction or by other methods of amortization approved by the tax authorities.
　　Article 10 Each of the "four specific amounts not exceeding…of the deductions" in the "progressive rates on incomes in excess of four specific amounts" as provided in Article 7 of the Regulations includes that ratio.
　　The amount of land value appreciation tax may be assessed by the simplified method of multiplying the amount of increment by an applicable tax rate minus the value of the deductible items times a deduction coefficient for quick computation， specifically as follows：
　　1. Where the amount of increment does not exceed the deductions by 50%：
　　The amount of LVIT payable = the amount of increment X 30%
　　2. Where the amount of increment does not exceed the deductions by 50 ～ 100%：
　　The amount of LVIT payable = the amount of increment X 40% —— value of the deductible items X 5%
　　3. Where the amount of increment does not exceed the deductions by 100 ～ 200%：
　　The amount of LVIT payable = the amount of increment X 50% —— value of the deductible items X 15%.
　　4. Where the amount of increment does not exceed the deductions by 200% or more：
　　The amount of LVIT payable = the amount of increment X 60% —— value of the deductible item X 35%
　　The 5%， 15% and 35% in the formulae are coefficients for quick computations.
　　Article 11 The "typical residential houses" mentioned in （1） of Article 8 of the Regulations refers to ordinary residential houses built on the standards of typical ordinary residential houses of the locality. Deluxe apartments， villas and vacationing retreats are not ordinary residential houses. The delineation between ordinary residential houses and other residential houses shall be determined by the people's governments of the provinces， autonomous regions and municipalities directly under the State Council.
　　When the land value increment of an ordinary residential house built by a taxpayer for sale does not exceed the combined total value of the deductible items by 20% as provided in （1）， （2）， （3）， （5） and （6） of Article 7 of these Rules， the house shall be exempted from LVIT； and when the increment value exceeds the combined total value of the deductible items by 20% or more， LVIT shall be levied on the total increment volume in accordance with the relevant regulations.
　　The "land or realty requisitioned or taken back by the State in need for national construction in accordance with the law" cited in （2） of Article 8 of the Regulations refers to the houses requisitioned or land the use right thereof taken back by the State with the government approval to meet the need for urban planning and national construction.
　　In the case resettlement of the occupants is required owing to the urban planning and national construction and the original real estate is transferred by a taxpayer on its own accord， LVIT may be exempted in line with this provision.
　　Institutions and individuals covered by the provisions for tax exemption above shall apply for exemption of land value appreciation tax to the local tax authorities where the land is located for approval and the tax authorities shall agree to exemption of LVIT upon verification thereof.
　　Article 12 When an individual transfers his original residential house on account of a change of work or for the purpose of improving his living conditions， he shall apply to the tax authorities for approval for exemption of LVIT， and exemption of LVIT may be granted on cases of having resided there for at least five years； or a 50% reduction of LVIT on cases of having resided there for over three years but less than five years. He shall pay LVIT in accordance with the regulations with a term of residence of less than three years.
　　Article 13 "The appraised price of the realty" mentioned in Article 9 of the Regulations refers to the price based on a comprehensive appraisal of the price of land of the same type in the same locality made by an officially approved realty appraiser.
　　Article 14 "Concealing and falsely reporting the price of a land transaction" mentioned in （1） of Article 9 of the Regulations refers to the conduct of a taxpayer of concealing or intentionally understating the price of the transfer of land use right， the structures and other attachments thereon.
　　"The deductions provided are false" mentioned in （2） of Article 9 of the Regulations refers to the conduct of a taxpayer making false statement of the actual amounts of the deductions in filing tax returns.
　　"The price of the deal is lower than the appraised price without a proper reason" in （3） of Article 9 of the Regulations refers to the conduct of a taxpayer of stating the price of a realty transaction that is lower than the appraised price in such a transaction by a certified appraiser whereas the taxpayer fails to provide the necessary evidence or a proper reason.
　　In the case of concealment or false report of the price of a realty transaction， an appraised price shall be made by a certified appraiser in the light of the market price of the same type of realty. The tax authorities shall determine the proceeds from the realty transfer on the basis of the appraised price.
　　In the case of false statement of the amounts of deductions， appraisals shall be made by a certified appraiser on the basis of the cost price of the realty by timing the cost price of the replacement of the realty with the ratio of depreciation and the basic price of the land at the time acquiring the land use right. The tax authorities shall determine the amounts of the deductions in the light of the appraised price.
　　In the case of the transaction price being lower than the appraised price in a realty transfer without a proper reason， the tax authorities shall determine the proceeds from the realty transfer in the light of the appraised price of the realty.
　　Article 15 A taxpayer shall follow the procedure below for filing tax returns in accordance with the provisions of Article 10 of the Regulations：
　　1. The taxpayer shall file tax returns with the local tax authorities within seven days after the signing of a land transfer contract and provide the tax authorities with the documents of the ownership of the house and other structure， the certificate of the land use right， the land transfer deed， the property transaction contract， an appraisal of the realty and other related information thereof.
　　In case the taxpayer cannot file tax returns on each transaction because of the high frequency of such transactions， he may， with examination and approval by the tax authorities， file tax returns at fixed intervals， the specific time of which shall be determined by the tax authorities in the light of actual conditions.
　　2. The taxpayer shall pay LVIT in accordance with the amount of tax assessed by and time limit prescribed by the tax authorities.
　　Article 16 In view of the fact that the proceeds of a taxpayer from a realty transfer before the completion of the whole project cannot provide a basis for assessing the amount of the land value appreciation tax on account of difficulty of determining the costs or other reasons， prepayment of LVIT shall be made pending final settlement at the completion of the whole project with the excess refunded and shortage made up by supplementary payment.
　　Article 17 The locality of a realty mentioned in Article 10 of the Regulations refers to the actual location of a real estate. In the case of a taxpayer having real estates in two or more localities， he shall file tax returns at different localities.
　　Article 18 "The land administrative department and real estate management department shall provide the relevant information and assist the taxation department in collecting LVIT in accordance with the law" in Article 11 of the Regulations refers to the fact that the land administrative department and real estate management department shall provide the tax authorities with evidences of the ownership of the house and other structures， the land use right， the actual amount of money for the transfer of the land， the basic price of the land， the price on the real estate market and information related to the change of ownership of the land and other matters.
　　Article 19 Should a taxpayer fail to provide the title deed of the house and other structure， the certificate of the land use right， the land or real estate transfer contract， an appraisal report of the realty and other information related to the realty transfer in accordance with the relevant regulations， the case shall be dealt with in accordance with the provisions of Article 39 of the "Law of the People's Republic of China on the Administration of Tax Collection" （hereinafter referred to as the "Tax Administration Law"）。
　　Should a taxpayer fail to make truthful report of the actual payment for a realty transaction and the specific amounts of the deductions thus resulting in underpayment or no payment of the tax， the case shall be dealt with in accordance with the provisions of Article 40 of the Taxation Administration Law.
　　Article 20 LVIT shall be collected in RMB as the accounting unit. In case of proceeds from realty transfer in a foreign currency， the income thereof shall be converted into the local currency （RMB） at the exchange rate quoted by the State on the same day or the first day of the month for assessment of the tax payable.
　　Article 21 "All local stipulations on the taxation on land value increment" mentioned in Article 15 of the Regulations refers to all those provisions for the collection of fees and charges on land value appreciation which have the same objects of taxation as provided by the Regulations.
　　Article 22 The Ministry of Finance or the State Administration of Taxation shall be responsible for the interpretation of these Rules.
　　Article 23 These Rules shall go into effect as from the day of promulgation.
　　Article 24 LVIT on proceeds from realty transactions taking place between January 1， 1994 and the day of the promulgation of these Rules shall be implemented with reference to the provisions of these Rules.