The Deed Tax Law Of The People’s Republic Of China.

Legal News & Analysis - Asia Pacific - China - Tax

23 October 2020


On August 11, 2020, the Standing Committee of the National People’s Congress promulgated the Deed Tax Law of the People’s Republic of China (the “Deed Law”).  The Deed Law elevates deed tax regulations from an administrative regulation level to national law, while amending and upgrading the Interim Regulations of the People’s Republic of China on Deed Taxes promulgated by the State Council on July 7, 1997, and also, taking into account new problems in the deed tax collection process.  The Law will come into force on September 1, 2021, and the Interim Regulations of the People’s Republic of China on Deed Taxes will be repealed at the same time.

With regard to the scope of taxable acts, the Deed Law makes it clear that ownership transfer of lands and housing units for investment (share acquisition), repayment of debts, transfer, reward, etc., shall be subject to deed tax.  This provision aims to provide a basis for taxation of new forms of transactions observed in recent years.

For the deed tax rate, Article 3 of the Law specifically sets the rate at 3% to 5%, but it should be noted that the applicable tax rate shall be determined by the people’s governments at the provincial, autonomous region and municipal level directly under the jurisdiction of the State Council, while different tax rates can be determined in accordance with specific procedures for ownership transfer for different entities, different regions and different types of housing.

Regarding what may be exempted from the deed tax, the Law adds three new types of tax-exempt ownership transfer of lands and housing units, including between husband and wife during marriage; the inheritance of lands and housing units by legal heirs; and assuming ownership of lands and housing units by foreign embassies, consulates and representative offices of international organizations in China, all of whom are tax exempt pursuant to law.

In addition, the Law specifically provided for confidentiality of the personal information of deed taxpayers, which require tax authorities and their staff to keep confidential the personal information of taxpayers in the process of tax collection and administration and not disclose or illegally provide such information to others.


For further information, please contact:  


Joyce Wen, Lee Tsai & Partners

[email protected]