In accordance with the provisions of Provisional Regulations of the People’s Republic of China on Real Estate Tax, real estate tax is levied on houses. It is levied in cities, counties, administrative towns, and industrial and mining areas, and shall be paid by the owner of the property right. Proportional tax rates are adopted for real estate tax. The tax rate shall be 1.2 percent where the calculation of tax is based on the residual value of the property, and shall be 12 percent where the calculation of tax is based on the rental income from the property.