The Ministry of Finance is cracking down on speculation in the property market! Adjusting the definition of luxury home tax, with a threshold of over 750,000 per ping in New Taipei City, is the standard to watch at once (.

The Taiwan government recently introduced a series of anti-speculation policies on the property market. Recently, the Ministry of Finance has adjusted the luxury home tax threshold on the 19th, changing the calculation method from total property price to price per ping for the first time, bringing some low-total-price, high-price-per-ping luxury homes into the taxable range, estimated to affect at least 4,000 households. (Background: BTC. Real Estate Golden Cross: Crypto World KOL buys in Taipei, TSMC engineers sell off, construction volume hits a 5-year low) (Context: Taiwan’s property market volume plummeted by 40% in January ‘in line with BTC golden cross’? Experts criticize government manipulation of actual transaction registration) The Taiwan Ministry of Finance recently announced the ‘2024 Annual Individual Property Sale Tax Calculation Regulations,’ applicable to old properties acquired before 2016 (when the property and land tax system was implemented). The new regulations make significant adjustments to high total price or high price per ping properties, adding a price per ping threshold, raising calculation standards in some regions, and increasing the profit rate to 20%, affecting the tax burden of high-priced property traders. Luxury home identification criteria relaxed according to the latest regulations from the Ministry of Finance, if the sold property reaches the following total price or price per ping thresholds, the actual transaction amount shall be used for calculation rather than the assessed current value of the property: Taipei City: Total price above 60 million or price per ping above 1.2 million New Taipei City: Total price above 40 million or price per ping above 750,000 Taoyuan City, Hsinchu County, Hsinchu City, Taichung City, Tainan City, and Kaohsiung City: Total price above 30 million or price per ping above 500,000 Other counties and cities: Total price above 22 million or price per ping above 350,000. The Ministry of Finance stated that the tax calculation method for these properties will be based on the ratio of the assessed property value to the announced land value, with the tax rate raised to 20% from the previous 17%. The Ministry of Finance previously had different definitions of luxury homes under the old system in each county and city. However, starting in 2024, a price per ping has been added, calculated by dividing the total transaction amount of the property without parking spaces by the total ping of the property without parking spaces. This will classify properties as ‘luxury homes’ if the price per ping exceeds 1.2 million in Taipei City, 750,000 in New Taipei City, 500,000 in the four cities plus Hsinchu, and 350,000 in other counties and cities. For example, if a property in Taipei City was sold for 30 million (including parking spaces) with a price per ping of 1.5 million (excluding parking spaces) last year, and it was subject to the old tax system, it would not have been considered a luxury home based on past standards. However, according to the latest standards from the Ministry of Finance, this property will now be classified as a luxury home and subject to stricter tax regulations. The Ministry of Finance pointed out that in 2024, due to the rise in property prices, out of 365 administrative districts in Taiwan, 200 districts have raised the property tax calculation rate, with the highest increase being 5%. The heavily affected areas include Wugu and Sanxia in New Taipei City; Taoyuan, Zhongli, Luzhu, Guishan, and Bade in Taoyuan City; Anding and Xinying in Tainan City; Qiaotou and Ziguan in Kaohsiung City; and Zhubei City in Hsinchu County. The Ministry of Finance emphasized that this adjustment was made based on economic conditions and property transaction situations to prevent high-priced properties with small areas from undervaluing profits. If taxpayers believe that the calculated income is higher than the actual profit and cannot provide complete Transaction Cost data, they can request the tax authorities to assist in verification according to the Taxpayer Rights Protection Act to ensure a reasonable tax burden. Small luxury home market impacted Analysts believe that this policy may lead buyers and sellers in the property market to reassess their strategies, especially impacting the ‘small luxury home’ market. Many investors or homeowners previously chose high-priced, small-sized properties, which are now classified as luxury homes, increasing the tax burden and potentially affecting turnover and price fluctuations. Additionally, when choosing properties, buyers will need to pay attention not only to the total price but also to whether the price per ping exceeds the threshold to avoid high tax liabilities in the future. Related reports: BTC. Real Estate Golden Cross: Warning from property tycoons - property prices may continue to fall for several years, with a 4% annual cut. China’s rescue plan for the property market with the ‘4+4+2’ stimulus policy, but the problem of unfinished buildings is difficult to solve; construction stocks are falling instead of rising. Property market frozen! Real estate association calls for nine demands: policy adjustments needed to avoid a nationwide default crisis. Ministry of Finance cracks down on property speculation! Adjusts luxury home tax definition, New Taipei City’s price per ping exceeding 750,000 will meet the standard ( at once ). This article was first published on BlockTempo, the most influential blockchain news media in the industry.