Free transfer is easily confused with land transfer fee reduction. As for the relief of land leasing, State Taxation Administration of The People's Republic of China's Reply on Exempting Land Leasing from Deed Tax on the Transfer of State-owned Land Use Rights (Guo [2005] No.436) stipulates: "The land leasing fees payable for the use rights of state-owned land shall be subject to deed tax. Deed tax shall not be reduced or exempted because of the reduction or exemption of land transfer fees. " For the land allocated free of charge, the Notice of the Ministry of Finance of People's Republic of China (PRC), State Taxation Administration of The People's Republic of China, on the Deed Tax Issues Concerning the Transfer of State-owned Land Use Rights (Caishui [2004] 134No.) stipulates: "If the land use right is obtained by allocation first, and then the transfer is approved, the deed tax shall be paid according to law, and the tax shall be based on the land transfer fee and other transfer fees that should be paid back." It can be seen that free transfer and land transfer fee relief are not a concept, and free transfer is a law that does not levy land transfer fees; It is stipulated by law that land transfer fees should be levied and reduced. Therefore, the land allocated by the government for free is not subject to deed tax. However, it should be noted that the allocation of land for free does not mean that the transferee does not have to pay the land compensation fee (land compensation fee refers to the compensation for the losses caused by the state expropriation of land to land owners and land users due to their investment and income in the land, not the land transfer fee), resettlement fee, young crops compensation fee and ground attachments compensation fee. The Notice of State Taxation Administration of The People's Republic of China, Ministry of Finance of People's Republic of China (PRC) on Deed Tax Issues Concerning the Transfer of State-owned Land Use Rights (Caishui [2004] 134) stipulates: "If the land is transferred by agreement, the transaction price shall be the tax basis. The transaction price includes land transfer fees, land compensation fees, resettlement compensation fees, ground attachments and young crops compensation fees, demolition compensation fees, municipal construction supporting fees and other economic benefits that the undertaker should pay. " Therefore, the land compensation fee paid by the real estate development company when it receives the land use right allocated free of charge shall be subject to deed tax at the applicable tax rate.