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Waive stamp duty, developer’s association urges Putrajaya

 | February 28, 2017

The Real Estate and Housing Developers Association says developers are already affected by GST.

Muztaza-Mohamad-rehdaPETALING JAYA: The Real Estate and Housing Developers Association (Rehda) wants the government to waive the stamp duty on properties.

Rehda national treasurer Muztaza Mohamad said he hoped the government would consider waiving the stamp duty if its cash flow was “okay”.

The waiving of stamp duty was on the top of the list of requests to be submitted to the government. Rehda’s “wish list” is submitted yearly and it suggests ways the government can further support the industry.

Muztaza explained that developers were already affected by the GST and the expected increase in stamp duty on properties priced at over RM1 million from 3% to 4% will further affect sale of properties.

Although residential properties are GST-exempt, developers are still affected by the 6% GST on building materials and services.

“So if you want to promote the property industry, we can minimise the stamp duty to make it more affordable,” he told reporters on the sidelines of Rehda Institute’s Economic and Business Outlook Conference 2017.

“Sometimes, buyers can’t afford to pay this 3% to 4% . If a property is RM1 million, then they will need to pay RM40,000 in stamp duty, so its quite a lot of money there.”

In addition, he said there were legal costs as well as the Real Property Gains Tax (RPGT) on properties sold within six years of the date of purchase.

Last October, in tabling Budget 2017, Prime Minister Najib Razak announced a stamp duty exemption for first-time homeowners limited to properties valued up to RM300,000.

However, it was announced that stamp duty for properties worth over RM1 million would be increased from 3% to 4% effective Jan 1, 2018.

Earlier, in his keynote address, Muztaza also spoke on the need for parents to help their children save up for their own homes.

He said, nowadays, many youngsters rely on their parents to come up with the down payment for a home, but not every parent could afford to do this.

“I think parents can start savings accounts for their children to buy a home. They can put 5% to 10% of gross income there.”

Veteran property consultant Ernest Cheong had said in an earlier report that many more young Malaysians may have to stay with their parents for a longer period compared to previous generations.

He said the reality was that many who earned average incomes simply couldn’t afford a housing loan because salaries weren’t rising in tandem with the cost of living.

Buying a house? Forget it, Average Joe


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