Nation's announced land value soars nearly 15% over last year's
By Kathryn Chiu, The China PostTAIPEI, Taiwan --The Ministry of the Interior (MOI) published Taiwan's 2014 average announced current land value on Tuesday, which showed a 14.19-percent jump from 2013 and the largest adjustment over the last two decades.
January 1, 2014, 12:15 am TWN
Given that Taiwan's average announced current land value is positively related to real-property taxes, the upsurge of average announced current land value signifies higher tax rates in real property-correlated taxes including deed, stamp, house, land value and land value increment taxes.
The MOI's readings also showed that among Taiwan's 22 cities and counties, the three areas with the largest annual adjustments in current land values are in the outlying counties of Kinmen, Lienchiang and Penghu, the values of which went up 42.99 percent, 35.74 percent and 30.57 percent, respectively.
Rounding out the top 5 table are Taichung City and Taoyuan County, with the growth in assessed land values at 24.43 percent and 22.5 percent.
Taipei had an average increase of 13.23 percent, the steepest adjustment in the city in 22 years, according to the report.
The Central News Agency reported that the MOI attributed the significant growth to a new system implemented in August 2012 that requires actual property transaction prices to be registered in a government database.
The system has made market values for property more transparent, allowing announced current land value to reflect more closely actual market prices, an MOI official told the CNA.
According to Taiwan's “Equalization of Land Rights Act,” the announced current land value shall be re-assessed each year and the assessment result shall be publicly announced on Jan. 1 of each year to serve as a reference for the competent authorities to examine the existing announced current values of lands at the time of changes in land rights and as a basis for compensation for land compulsorily purchased.
Speculators Feel Sting of New Land Values
After the latest adjustment, Taiwan's average announced current land value represents 86 percent of the average real estate market price.
Taiwan's announced current land values have historically been far lower than actual market prices, but local governments have moved aggressively to bring their assessed values closer to the market in recent years to increase tax revenues.
The MOI earlier said that the announced current land value is expected to make up at least 90 percent of actual market price in 2015.
In mid-December, major city and county governments unveiled their updated assessments in their jurisdictions, which will take effect starting from the first day of 2014.
For example, the Taipei City government announced an average increase of 13.23 percent in its announced current land values throughout the city, the steepest adjustment in 22 years. After the adjustment, announced current assessed land values in Taipei will reach about 89 percent of market prices.
A Yungching Realty Group (永慶房屋) researcher said that the land value adjustments made for 2014 could affect the property market's prospects.
The impact of sharp rises in 2014 announced current land values may have already been felt, the Yungching Realty Group researcher told local media earlier. The number of residential construction projects launched in November, for example, declined by more than 40 percent from October's level, he said.