State Administration of Taxation, Official Reply on Tax Issues Concerning the Assignment of Land for Which the Formalities Relevant to the Leasehold Certificate Have Not Yet Been Completed

Issued: June 14 2007

Main Contents: Where a land user transfers, mortgages or exchanges land, he/she and the other party shall pay business tax, land value-added tax and deed duty according to tax laws provided that he/she possesses the right to occupy, use, receive returns from or dispose of the land and there is evidence such as a contract to prove the actual transfer, mortgage or exchange of land from which he/she has obtained the corresponding economic benefit, irrespective of whether he/she has obtained the leasehold certificate or whether he/she and the other party have completed the formalities for the amendment of the registration for the leasehold certificate.