There are three different types of this tax in Poland, applicable to property, agriculture and forestry. The distinction between these three similar taxes has an important practical aspect, as the rate of taxation for property is far higher than the tax rate for the agriculture and forestry. The Local Taxes and Fees Act determines the general distinction between agricultural and property. The levels of property tax rates are decided by the Commune Council, but they cannot, in the course of the year, exceed the maximal rates per one square meter of taxable land surface determined in the Law Act. The property tax covers lands, buildings and the parts thereof, structures used for conducting business. Agricultural tax is calculated on the basis of the "convertible hectare" units held that take into account different classes of arable land, as well as the different economic and climatic conditions. Only farms covering more than 1 hectare and with over 1 hectare of land in cultivation are subject to this tax.