Laws of the People's Republic of China

    Article 1  Accepting units and individuals in transfer of ownership
rights for land and housing within the territory of the People's Republic
of China who are payers of contract tax should, pursuant to the provisions
of these Regulations, pay contract tax.

    Article 2  The transfer of ownership rights for land and housing
referred to in these Regulations mean the following acts:

    (1)transfer of land use right of the state-owned land;

    (2)transfer of land use right including sale, grant and exchange;

    (3)purchase and sale of housing;

    (4)grant of housing; and

    (5)exchange of housing.

    Transfer of land use right of section (2) of the preceding paragraph
does not include the transfer of contracted management right of rural
collective land.

    Article 3  The rate of contract tax is 3-5%.

    The applicable rate of contract tax shall be determined by the People's
Governments of the provinces, autonomous regions and municipalities directly
under the Central Government within the range prescribed in the preceding
paragraph in the light of the actual conditions of their respective regions,
and the same shall be submitted to the Ministry of Finance and the State
Taxation Administration for the record.

    Article 4  Basis for the calculation of contract tax is:

    (1)realized price of transfer of land use right of the state-owned
land, sale of land use right and purchase and sale of housing;

    (2)for grant of land use right and grant of housing, it shall be
verified and determined by the collection organs with references to market
price of sale of land use right and purchase and sale of housing; and

    (3)difference in price for the land use right and housing exchanged
for the exchange of land use right and exchange of housing.

    In case of realized price of the preceding paragraph obviously lower
than the market price and without justifiable reasons or the difference
in price for the land use right and housing exchanged is obviously irrational
and without justifiable reasons, the basis shall be verified and determined
by the collection organs with references to market price.

    Article 5  The amount of contract tax payable shall be calculated and
collected in accordance with the rate laid down in Article 3 and the basis
for calculation prescribed in Article 4 of these Regulations.

    Formula of calculation for amount payable:

    Amount payable=basis for calculation x rate

    The amount payable shall be calculated in RMB. In cases of settlement
in foreign exchange of transfer of land and housing ownership right,
conversion shall be made into RMB in accordance with the middle price
of the market exchange rate of RMB announced by the People's Bank of China
on the date of occurence of tax obligation.

    Article 6  Reduction or exemption of contract tax shall be effected
in any of the following circumstances:

    (1)exemption for state organs, institutions, societies and military units
accepting land and housing for office accomodation, teaching, medical service,
scientific research and military facilities;

    (2)exemption for urban and township workers and staff members in
purchasing public housing for the first time as provided for;

    (3)reduction or exemption shall be approved according to circumstances
for re-purchasing of housing due to destruction and loss of housing due to
force majeure; and

    (4)other items the reduction and exemption of contract tax of which
is provided for by the Ministry of Finance.

    Article 7  The taxpayers whose contract tax have been reduced or
exempted upon approval change the use of the land and housing in question
which is no longer within the scope of reduction or exemption of contract
tax as provided for in Article 6 of these Regulations should make up
the tax money already reduced or exempted.  

    Article 8  The day on which the taxpayer signs the land or housing
ownership right transfer contract or the day on which the taxpayer obtains
other vouchers of the nature of land or housing ownership right transfer
contract shall be the time of occurence of tax obligation of contract tax.

    Article 9  The taxpayer should, within ten days starting from the date
of occurence of tax obligation, submits tax declarations at the contract tax
collection organ of the locality wherein the land or housing is located
and makes the tax payment within the prescribed time period of the contract
tax collection organ.

    Article 10  The contract tax collection organ should issue contract tax
payment receipt for the taxpayer upon completion of tax payment by the
taxpayer.      

    Article 11  The taxpayer should complete the formalities for registration
for change in land or housing ownership right at the department of land
administration or the department of housing property administration in
accordance with law on the presentation of contract tax payment receipt
and other prescribed documents.

    The department of land administration or the department of housing
property administration shall not process the formalities for registration
for change in land or housing ownership right for the taxpayer's failure to
produce the contract tax payment receipt.

    Article 12  The financial organ or local tax organ of the locality
wherein the land or housing is located shall be the contract tax collection
organ. Specific collection organs shall be determined by the People's
Governments of the provinces, autonomous regions and municipalities directly
under the Central Government.

    The department of land administration and the department of housing
property administration should provide relevant information for the contract
tax collection organs and assist the contract tax collection organs in the
collection of contract tax according to law.

    Article 13  Collection and administration of contract tax shall be
enforced pursuant to the provisions of these Regulations and relevant laws
and regulations.

    Article 14  The Ministry of Finance shall formulate rules on the basis
of these Regulations.

    Article 15  These Regulations shall come into force as of October 1,
1997. promulgated by the
Administrative Council of the Central People's Government on April 3, 1950
is simultaneously annulled.