:::Land Value Tax

　The land value tax is one of the most important land taxes. It has the dual function of completing land policies and strengthening local finances. Its major contents are as follows:

A. Tax Scope
　 The land value tax is imposed on land that has been assigned a value. Land that has been assigned a value, and which is also being used as farm land, shall be taxed as agricultural land and no land value tax shall be levied on it in accordance with relevant laws.

B. Taxpayers
1. Land title owner.
2. For land with and established Dien Right, the Dien Right holder.
3. For bestowed land, the bestowee.
4. For land assigned to farming, the farmer. (Prevailing regulations provide that land being
　 used for farming shall be taxed in accordance with agricultural land tax regulations.)
5. For publicly owned land, the administration-in-charge.
6. For commonly owned land, the administrator.
7. For generally and jointly owned land, the joint owners shall be responsible for their
　 respective parts.

For the following situations, the tax authority may designate land users to be responsible for paying the land value tax:
1. When the whereabouts of the legal taxpayer (in accordance with the above) is unknown.
2. When the title right of the land is unclear.
3. When the land is under no one's management.
4. When the title owner of the land petitions for the occupier to pay the tax.

C. Tax Rates
　 There are two kinds of rates for land value tax; the regular progressive tax rate and the special privileged rate:
Regular progressive tax rate
　 A progressive tax rate shall be used to calculate the tax payable on regular land; the basic tax rate is 1% with the highest tax rate at 5.5%. The tax structure in this category is as follows:
a. For land value not exceeding the starting cumulative value; 1%
b. For land value in excess of the starting cumulative value (SCV), provided the portion in
　 excess is less than 500% of the SCV; an additional 0.5% shall be added for the excess
　 portion.
c. When the excess portion is above 500% of the SCV, on top of the aforesaid (a) and (b), for
　 each successive 500% in excess, an additional 1% tax rate shall be added on for that
　 respective portion, until the ceiling of 5.5% is reached.
d. The SCV is determined by adoption the average land value of 7 ares in the respective city
　 or county. Land used for factories, mining, agriculture or that which is exempted from tax
　 shall not be included in calculating the average land value.

Formulas for the Calculation of Land Value Tax Payable

Class	Formulas for Calculation
First Class	Tax payable=Taxable Land Value (Not exceeding SCV)X Rate(1%)
Second Class	Tax payable=Taxable Land Value (Portion exceeding SCV is Less than 500% of SCV ) X Rate (1.5%) --Cumulative Difference (SCV X 0.005)
Third Class	Tax payable =Taxable Land Value (portion exceeding SCV is less than 1000% of SCV) X Rate(3.5%) --Cumulative Difference (SCV X 0.065)
Fourth Class	Tax payable = Taxable Land Value (Portion exceeding SCV is More 1500% of SCV) X Rate(3.5%) --Cumulative Difference (SCV X 0.175)
Fifth Class	Tax payable = Taxable Land Value (Portion exceeding SCV is More 2000% of SCV) X Rate(4.5%) --Cumulative Difference (SCV X 0.335)
sixth Class	Tax payable = Taxable Land Value (Portion exceeding SCV is More 2000% of SCV) X Rate(5.5%) --Cumulative Difference (SCV X 0.545)

Special privileged rate
a. Residential land in urban area with a total areas with a total area of less than 3 ares (1 area
　 =100 square meters) or in non-urban areas with a total area less than 7 ares and used for
　 the purpose of a self-use residence shall be taxed at 0.2%.
b. Land used for industries, mining, private parks, zoos, gas stations and parking lots
　 approved by the government shall be taxed at 1%, but land which is not used in
　 accordance with an approved project shall be taxed at the regular rate.
c. Land reserved for public facilities pursuant to urban planning, which is being temporarily
　 used for self-use residential purposes while still maintaining the reserved status, shall be
　 taxed at 0.2% and in the case of non-residential use, at 0.6%.
d. Land publicly owned but used for non-public purposed shall be taxed at 1%.

D. Calculation of Land Value and Consolidated Total of land Value
1. Municipalities under direct supervision and counties shall each establish a land Value
　 Assessment Commission which shall make public announcement of their assessments of
　 land value by section and lot, based upon data including market value submitted by the
　 land administration in charge (“Posted Value”).
　 Land owners shall declare their land value with reference to the posted Value. When a land
　 owner does not declare the land value or the declared land value is less than 80% of the
　 posted Value, the Official Declared Value shall be adjusted to 80% of the posted Value
　 When the land value is declared in excess of 120% of the posted Value, it shall be adjusted
　 to 120% of the posted Value as the Official Declared Value.
　 The land administration shall compile report on “land value” and “land owner” in
　 accordance with the official Declared Value and transmit the same to the tax authority for
　 the levy of the land value tax.
2. Land value tax of regular land is calculated by using the cumulative scheme. Therefore, if
　 a taxpayer has more than one parcel of land in the same municipality or county (or city),
　 all the parcels owned shall be consolidated to reach the consolidated total value of land
　 which shall be the taxable land value calculated from the aforementioned formula.

E. Special Levy of Vacant Lot Tax
　 In order to enhance the effective use of land and to expedite urban development, vacant lot tax shall be levied on a lot where supportive systems such as roads, sewage systems, electricity and water supply systems have been completed, but the lot construction has not been carried out. In cases where the construction has been completed, but the said construction improvement is valued at less than 10% of the Declared Land Value of the land base for the construction, and determined by the municipal or county (city) government as requiring further development or alteration of the existing construction or reconstruction, the said lot, if still vacant, shall be subjected to an additional levy of vacant lot tax ("VLT") to be assessed by the municipal or county (city) government. The VLT shall equal 2 to 5 times the basic land tax payable for such a lot according to the regular land value tax calculation.

F. Reductions and Exemptions
1.Public land.
　 For publicly owned land used for public purposes, the land value tax is fully exempted. The following categories of land shall be included:

a. Land for public use.
b. Land used for all levels of government subsidiary agencies and autonomous agencies,
　 including dormitories for stall and employees thereof; but land used for business
　 enterprises there is excluded from this category of tax exemption.
c. Land used for offices, and dormitories of Monopoly Bureaus.
d. Land used for national defense, military institutes, military forces or schools.
e. Land directly used for public, hospitals, clinics, academic research institutes, social
　 educational institutes, salvation facilities, public and private schools, and dormitories
　 thereof, and schools' direct production facilities for student practical training. However, an
　 alien school should be established or confirmed by the alien government concerned, and
　 should be established by the statute for the establishment of alien schools, and reciprocal
　 treatment should exist in the country concerned with the ROC or it should be approved
　 case by case for tax exemption by the executive Yuan; a domestic private school must be
　 registered in accordance with the private school law.
f. If a plot of public land originally used for a public or private school and described in item
　 (e) has its title changed to a non-public owner, and the land still is used by the same
　 school, then the land still can apply the provision of item (e).
g. Land used for direct testing and experimental facilities by public institutes in farming,
　 forestry, fishing, pasturage (stock farming), industry and mining.
h. Land used for food storage and salt manufacturing, or salt fields by competent authorities.
i. Land directly used for the services of post, telephone and telegraph, railway, highway,
　 airport, air field, waterworks, garbage disposal, sewage systems, and dormitories for staff
　 and employees thereof; however, land solely used for subordinate business units is
　 excluded.
j. Land used for water collection, reservation, drainage and related construction thereof.
k. Land used for housing provided without charge by the government to people in need.
l. Historical sites and other points of interest and land used for memorial halls, shrines,
　 temples and cemeteries.
m. Land acquired or taken under eminent domain by the tourist authority for the purpose of
　 developing the tourist industry, and while it is awaiting sale to tourist enterprises and it is
　 not generating any revenue.
n. Land which is used for public parking lots established by the Law of Parking Lots

2.Private land
　 Private land in fulfillment of the following deduction schedule may have its land value tax deducted or exempted according to law.

a. Land used by a foundation (non-profit judicial person "NPJP") or for registered private
　 schools established by such an NPJP, and land used for student practical training in
　 farming, forestry, fishing, pasturage, or mining, and dormitories thereof complying with
　 management regulations set by educational administrative agencies in charge and
　 registered and NPJP property shall have full exemption. Land used for private tutoring or
　 correspondence schools is excluded from this exemption.
b. Land in direct use for private libraries, history or science museums, and fine art galleries
　 that are established with approval from educational administrative agencies in charge
　 pursuant to the "Regulations for Establishment and Encouragement of Private Social
　 Educational Institutes", and academic research institutes established in compliance with the
　 "Regulations for Establishment of Academic Research Institutes" is entitled to full
　 exemption if the private libraries, etc., are registered as an NPJP or established/operated by
　 an NPJP, and such land is owned by the NPJP.
c. Land used for non-profit private parks and gymnasiums, totally open to the general public
　 and established with the approval of the competent authority, shall be entitled to a 50%
　 reduction. If such a park or gymnasium is registered as an NPJP, the land shall be entitled
　 to a 70% reduction.
d. Land exclusively used for private testing facilities in farming, forestry, fishing, pasturage,
　 industry, or mining, which are duly registered with and approved by the competent
　 authority, and have been actually engaged in said testing or experimental activities for
　 more than 5 years, shall be entitled to a reduction of 50% if the use is certified by the
　 competent authority.
e. Land used for private hospitals or social charities and other enterprises for the enhancement
　 of public interest which are non-profit and which do not limit their service to people of the
　 same trade, the same locality, the same clan or schoolmates or other specific classes of
　 people, and shall have full exemption. But for the public interest enterprise as
　 aforementioned to be applicable, it must be established by a duly registered NPJP, where
　 the land in question is owned by said NPJP.
f. Land used for private cemeteries approved for establishment by the competent authority, as
　 NPJP shall have full exemption, subject to the limitation, however, that the land in question
　 is zoned as public cemetery land pursuant to urban planning, or if land is not covered by
　 urban planning, it should be designated as land for use as a cemetery.
g. Privately operated railroads and highways, or railroads and highway for exclusive use; if
　 their construction has been approved by the competent authority and are regularly open for
　 public use including passenger and cargo transportation, the land base for such railroads
　 and highway shall have full exemption.
h. The land used for agricultural irrigation systems by enterprises whose establishment has
　 been approved by the competent authority, to collect, store or drain water shall have full
　 exemption; however, land used for offices and working stations thereof shall have a 50%
　 reduction.
i. Land used for religious organizations beneficial to social morale and education duly
　 registered as NPJP or as temples; churches used for public sermons and approved by the
　 Ministry of Interior for establishment as institutes doing research in religious doctrines;
　 land used for temples and other memorial halls or shrines, shall have full exemption.
j. Land provided without charge for the use of governmental agencies, public schools or
　 military forces, institutes and schools, shall have full exemption for the period of the said
　 use.
k. Land used for the offices and commercial area for all levels of agriculture and fishing
　 associations, and warehouses duly registered as agricultural product warehouses, or
　 refrigerated sea-food warehouses belonging to fishing associations shall have a 50%
　 reduction.
l. Private historical sites which are assigned by the competent authority shall have full
　 exemption.
For revenue-generating land belonging to private schools provided in item(a) above, or the private academic research institutes provided in item (b) above, or the private charities provided in item (e) above, if all revenues generated are directly used for the respective enterprise, it may apply individually for deduction of relevant land value tax. Land used for the enterprises provided in items (c), (d), (f), (g), (h), and (k) above must be limited to the land owned by the respective enterprises. An enterprise in item (c) above may rent public land for its use in which case the provisions of item (c) are still applicable to the said public land

3.Passways under balconies and hallways
　 Passways or hallways for public passage with no construction improvement shall be exempted from land value tax; those with construction improvements are subject to the deduction schedule provided below (Article 10 of the Regulations for the Deductions and Exemptions of the Land Tax Law).

a. A one-story addition may claim a 50% reduction.
b. A two-story addition, a one-third reduction.
c. A three-story addition, a one-fourth reduction.
d. A four-story or more addition, a one-fifth reduction