A deed tax was inaugurated in our country during the Eastern Chin Dynasty slightly more than 1,600 years ago, with contracts transferring land and building titles as the basis of assessment. At that time, since no modern type of taxation such as income tax, commodity tax, customs duties, or dues had been introduced to China, the deed tax, and the tax on farmland, were the most important sources of the government’s fiscal revenue.
The Act on Deed Tax currently in force has been amended seven times since it was first promulgated in December 1940, with unification of the collection of the deed tax not being attained until December 1945, when the MOF announced The Guidelines for the Assessment of Standard Prices for immovable property for the whole country. In July 1964, the deed tax was designated a local tax. In recent years, the revenue realized from the collection of the deed tax has constituted around 0.9% of total tax revenue and has become one of the major sources of fiscal revenue for local governments.
In January 1951, the Executive Yuan promulgated The Provisional Measures for Uniform Collection of Various Taxes and Assessments in Taiwan Province during the Period of Communist Rebellion under which collection of the deed tax was suspended. In its place, a land registration fee was imposed in accordance with the Land Act at a rate of 1%, and as such a rate was far below the then effective average rate of 5% for the deed tax, financing for local governments was seriously affected.
As a result, collection of the deed tax was resumed and has been continued since February 1952.