Real estate tax reform in China: taxation scheme and effect assessment

Li Qi (), Chen Shuyun () and Gao Zhenjuan ()
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Li Qi: HeBei University
Chen Shuyun: Central China Normal University
Gao Zhenjuan: HeBei University

SN Business & Economics, 2025, vol. 5, issue 6, 1-20

Abstract: Abstract This article conducts a study on Chinese real estate tax levy mechanism characterized by “property tax” attributes on the foundation of “benefit tax” properties. Utilizing China Household Finance Survey data from 2019, the article estimates the tax-paying ability of various provinces under workable tax rates and devises five distinct tax relief schemes. By comparing the distribution of tax burdens, it finds that the “per capita value exemption” scheme yields the most robust progressivity and the most favorable outcome in terms of income adjustment. Building on the “per capita value exemption” scheme, three tax redistribution schemes are fashioned. The investigation into the repercussions of the real estate tax on overall family welfare through the Atkinson social welfare function reveals that the “per capita value exemption” scheme, combining with the redistribution scheme of “subsidies for families with minor children” is currently the most reasonable combination in the real estate tax collection plan.

Keywords: Real estate tax; Taxation scheme; Effect assessment; Atkinson social welfare function (search for similar items in EconPapers)
JEL-codes: E62 H21 R31 (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s43546-025-00824-9

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