When leased farmland, according to the laws, has been designated for the purpose of construction, and then the lessor terminates the lease contract in order to take the land back to use for the purpose of construction or to sell it for the purpose of construction, according to the laws, the lessor shall compensate the lessee with the amount equivalent to one third of the land value, and after the deduction, according to specific facts, of necessary expenses and actual losses, if there is any compensation left, income tax shall be levied according to Category 9 of Paragraph 1 of Article 14 of the Income Tax Act.

　　　 When leased farmland, according to the laws, has been designated for the purpose of construction, and then the lessor terminates the lease contract in order to take the land back to use for the purpose of construction or to sell it for the purpose of construction, Paragraph 2 of Article 56 of the Act Governing Enforcement of the Equalization of Urban Land Rights, as amended and promulgated on February 12, 1968, provides that the lessor “shall compensate the lessee with the amount equivalent to one third of the declared value of the land, besides compensating the lessee for the expenses he has incurred in making land improvements as well as for any crops not yet harvested,” for this termination is not executed by the lessee voluntarily, and the lessee’s living expenses need to be taken into account as well in order to reduce the disputes between the lessor and lessee and to facilitate the urban development.　The aforesaid Act was reenacted as the Equalization of Land Rights Act on February 1, 1977, and the provision of Paragraph 1 of Article 77 of this Act has revised the above-mentioned provision as “In terminating the lease contract and taking the land back according to the provisions of the preceding Article, the lessor shall compensate the lessee for the expenses he has incurred in making land improvements as well as for any crops not yet harvested.　In addition, if the termination is to take the land back for the lessor himself to use for the purpose of construction, the lessor shall calculate the land value increment tax beforehand by the announced current land value at the time of the termination of lease contract, and compensate the lessee with the amount equivalent to one third of the difference between the announced current land value and the anticipated land value increment tax; if the termination is to sell the land out for others to do the construction, the lessor shall compensate the lessee with the amount equivalent to one third of the difference between the current land value and the land value increment tax.”　This provision is in order to compensate the lessee, after the termination of the lease contract, for the costs of moving, changing jobs or other paid necessary expenses, and the actual loss derived from the expectation of the continuance of the lease contract, if any; this amount of money does not belong to the income upon which the income tax shall be levied.　However, after the deduction, according to specific facts, of necessary expenses and actual losses, if there is any compensation left, income tax shall be levied on it according to Category 9 of Paragraph 1 of Article 14 of the Income Tax Act.