Tax System

Real estate transfer tax of 5% of the market value is imposed on the transfer of real estate ownership. This tax is payable by both domestic and foreign legal entities and individuals, unless an international treaty provides otherwise. Buyers may not be obliged to pay this tax if certain conditions prescribed by the Real Estate Tax Act are met. The transfer tax does not apply to the acquisition of new buildings, that is, first sale. Instead, the sale is subject to 23% VAT of the value of construction, i.e., the net construction value.