Tenants bearing burden of tax on rented houses
the new personal income tax policy that allows taxpayers to deduct certain amounts of money, such as for housing loan interest or housing rent, from their taxable income, has come into effect. A good policy has come out that aims at lightening people’s burden, but some people’s burden has become heavier because there are those making use of the policy to benefit themselves. Ifeng.com comments:
STARTING IN JANUARY,
Reports show some house owners threaten to raise rents because they worry the information collected from their tenants might lead to them having to pay realty tax in the future. The new personal income tax deduction policy offers an opportunity for taxation departments to collect the information indirectly from house renters, but the renters and house owners have different interests. Considering the usual superiority of house owners over renters in the market, renters will be the losers. If they refuse, they might be chased out of the properties they rent from the owners.
House owners and housing agencies should pay tax for their income from rents, but many of them simply refrain from registering their renting contracts in order to avoid paying the tax. That problem has long
existed and it takes quite huge, complicated efforts to collect all the information needed from house owners and agencies.
Those who implement the policy should have expected this and filled in this loophole before implementing it nationwide. Take the taxes involved in housing for example, in order to prevent this, taxation departments must have a stronger sense of responsibility. It is their job to collect information from house owners for tax purposes, which pressure should not be shifted to the tenants. For example, they could introduce more favorable policies for house owners who lease their houses out, so as to encourage them to register willingly, instead of shifting the pressure to tenants.