Under the new Land and Building Tax Law the income-based method previously used in tax calculation will be replaced by an assessment based on a property’s appraised value to improve the clarity of future tax calculations
The Land and Building Tax Law will introduce two major changes to tax calculations, which are 1) A shift to a cost approach assessment and 2) Levying tax based on land use.
Firstly, tax calculation using the cost approach under the new law is a transition from the previous income approach that heavily depended on officers’ assessment views.
Under the new scheme, tax determination is based on the appraised value of the property, calculated from the sum of standard land and building prices set by the Treasury Department.
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This approach separates the valuation of land and buildings, whereby the price of the latter varies with the type of construction. The renewal of both land and building costs are adjusted at four year intervals.
Secondly, land use categories will be considered under the new tax module. Previously, tax rates were considered based on the annually appraised value of the asset. However, under the new tax law the same building may be imposed with different tax rates…
