Japan’s National Tax Agency is calling on local tax offices to enforce stricter checks with regards to the purchase of high-rise apartments by wealthy individuals as a way of reducing their inheritance tax burden.
The inheritance tax charged on real estate is calculated based on the taxation value of the property rather than the market value. For apartments in high-rise buildings, the taxation value can be considerably lower than the actual market value because the land ownership share is usually quite small. The value of the apartment itself is also based on the size of the apartment and does not take into account the finish of the interior, whether it is on a high or low floor, nor the building facilities and services.
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