SAT Clarifies Treatment of Land Appreciation Tax on Transfer of Certain Infrastructure

The State Administration of Taxation issued a tax circular late last month affirming that the transfer of certain infrastructure constructed on a piece of land is subject to land appreciation tax.

Issued in response to a request from the Xiamen municipal tax bureau, Guoshuihan [2010] No. 347 clarifies the treatment of land appreciation tax on the transfer of infrastructure, including pier parking lots and airport runways.