THE INTERIM REGULATIONS OF THE PEOPLE’S REPUBLIC OF CHINA GOVERNING LAND USE TAX ON CITIES AND TOWNS

State Council

Order of the State Council of the People’s Republic of China

No. 17

The Interim Regulations of the People’s Republic of China Governing Land Use Tax on Cities and Towns, which was adopted at the twelfth
executive meeting of the State Council on July 12, 1988, are hereby promulgated and shall be implemented as of November 1, 1988.

Premier, Li Peng

September 27, 1988

The Interim Regulations of the People’s Republic of China Governing Land Use Tax on Cities and Towns

Article 1 .

These Regulations are formulated with the view to rationalizing the use of land in cities and towns, to regulating the income from
grades difference of the land, to improving efficiency and profit by use of the land and to strengthening the land management.

Article 2 .

Units and individuals which use land within the boundaries of cities, county towns, towns/bases operated under an organizational system
and industrial and mining districts shall be the obligatory payers of tax (hereinafter referred to as taxpayers) for land used within
cities and towns (hereinafter referred to as land use tax) and shall pay land use tax in accordance with provisions of these Regulations.

Article 3 .

Calculation of land use tax shall be based on the actual area of land took up by the taxpayer and shall be levied in accordance with
the stipulated tax rate.

The work of organizing and measuring the taking up area of land as referred to above shall be determined by the people’s government
of province , autonomous region or municipalities directly under the Central Government in accordance with the actual circumstances.

Article 4 .

The annual tax rates of land use tax for per square meter shall be as follows:

(1)

RMB 0.5 yuan to 10 yuan in large cities;

(2)

RMB 0.4 yuan to 8 yuan in medium cities;

(3)

RMB 0.3 yuan to 6 yuan in small cities;

(4)

RMB 0.2 yuan to 4 yuan in county towns, towns/bases operated under an organizational system and industrial and mining districts.

Article 5 .

Based on conditions such as the circumstance of municipal construction and the degree of economic prosperity and etc., the people’s
governments of provinces , autonomous regions and municipalities directly under the Central Government shall determine the appropriate
tax rate ranges for the districts under their jurisdiction within the range of tax rates listed above.

The people’s governments of cities and counties shall divide the land in their district into certain grades based on the actual
circumstances and shall, within the tax rate ranges determined by the people’s governments of provinces , autonomous regions and
municipalities directly under the Central Government , formulate corresponding appropriate tax rate standards, and submit to the
people’s government of provinces , autonomous regions or municipalities directly under the Central Government for approval and
implementation.

Subject to approval by the people’s governments of provinces , autonomous regions or municipalities directly under the Central Government
, the land use tax rate standard levied in economically backward districts may be reduced appropriated, but shall not be lowered
to exceed 30% of the minimum tax rate stipulated in Article 4 of these Regulations. The land use tax rate standard levied in economically
developed districts may be raised appropriately, but the amount shall first be approved by the Ministry of Finance.

Article 6 .

Land use tax shall be exempted on the following types of land:

(1)

the land for self use by State organs, people’s organizations and the armed forces;

(2)

the land for self use by units which their expenditures are allocated and funded by the State’s finance departments;

(3)

the land for self use by religious temples and shrines, parks and places of historic interest and scenic spots ;

(4)

the land for public use , such as municipal streets, public squares and areas of greenery and etc.;

(5)

the land for production use directly used in the agricultural, forestry, pastoral and fishery industries;

(6)

in the case of land whose reclamation from the sea or transformation from wasteland was approved, land use tax shall be exempted for
5 to 10 years from the month beginning to use;

(7)

the land used for facilities on energy resources, transportation, and water conservancy, and other uses which the Ministry of Finance
has exempted from tax in other provisions. .

Article 7 .

In addition to cases provided for under the provisions of Article 6 of these Regulations, a taxpayer who has genuine difficulty paying
the prescribed land use tax may request a reduction of or exemption from the tax on a periodic basis After the tax organ of provinces,
autonomous regions or municipalities directly under the Central Government has examined and verified the circumstances of the case,
the details shall be submitted to the State Taxation Bureau for approval.

Article 8 .

Land use tax shall be calculated annually and paid by installments. The time limit for payments shall be determined by the people’s
governments of provinces , autonomous regions or municipalities directly under the Central Government. .

Article 9 .

For newly requisitioned land, the land use tax shall be paid in accordance with the following provisions:

(1)

if cultivated land is requisitioned, the land use tax shall be levied one year after the date on which approval to expropriate the
land is given.

(2)

if non-cultivated land is requisitioned, land use tax shall be levied from the month after approval to expropriate the land is given.

Article 10 .

Land use tax shall be collected by the local tax organ in the area where the land is located. Land management organs shall provide
the information of land use rights to the local tax organs where the land is located.

Article 11 .

Administration of the levying of land use tax shall be handled in accordance with the provisions of the Interim Regulations of the
People’s Republic of China governing Administration of the Levying and Collection of Taxes.

Article 12 .

Income from the land use tax shall bring into financial budget administration.

Article 13 .

The Ministry of Finance shall be responsible for interpreting these Regulations. Implementing measures shall be formulated by the
people’s governments of provinces, autonomous regions and municipalities directly under the central government and the details shall
be submitted to the Ministry of Finance for archival file.

Article 14 .

These Regulations shall take effect from November 1,1988 and the land use fee measures formulated by all localities shall be suspended
simultaneously.