Paper/Speech Details of Conference Program for the 16th NISPAcee Annual Conference Program Overview V. Working Group on Public Sector Finance and Accounting Author(s) Eugenia Busmachiu Academy of Economic Studies of Moldova Chisinau Republic of Moldova Title Property taxation in the Republic of Moldova File Paper files are available only for conference participants, please login first. Presenter Abstract PROPERTY TAXATION IN THE REPUBLIC OF MOLDOVA Dr. Eugenia Busmachiu Academy of Economic Studies Moldova Abstract: Decentralization of fiscal, political and/or administrative responsibilities to the local governments started in Moldova from 1998. Approving the package of laws on local public administration laid the foundation for the creation of the legal and institutional framework of intergovernmental fiscal arrangements. The decentralisation of the functions of public finances has become a characteristic feature of the budget-tax policy of the Republic of Moldova. Moldova has already changed some laws to give local governments the additional autonomy but has not resolved yet many important questions regarding how local governments should be financed. Because the municipalities lack fiscal autonomy they do not really have any autonomy at all. The traditional role of the property tax as the important source of revenues of local governments in the Moldova has been much increased in the last years. Particularly insufficient revenue autonomy is the weak point of a local government system. Local governments have no sufficient local tax base, independent authority over user charges, and administrative capacity to collect local revenues. Property tax, millage tax is an ad valorem tax that an owner of real estate or other property pays on the value of the property being taxed. There are three species or types of property: Land, Improvements to Land (immovable man made things), and Personality (movable man made things). Real estate, real property or realty are all terms for the combination of land and improvements. To create a local tax base (commercial and residential property) in Moldova the Government implemented Title VI “Property Tax”. Pricing regulations constrain local efforts to achieve greater cost recovery. The taxing authority requires and/or performs an appraisal of the monetary value of the property, and tax is assessed in proportion to that value. The maximum rate of the real estate tax is set at 0.25 % of the taxable base of the real property. In the municipality of Chisinau, except for suburbs making part of it the real estate tax rate is set at 0.02 %. Real property tax is often identified as a major source of local government finance that has the potential to contribute substantially to locally raised revenue. This article reports on examination property taxation practice in the Republic of Moldova.