RPGT should be increased for third, subsequent properties :HBA

PETALING JAYA: The National House Buyers Association (HBA) has urged the government to reconsider the increase in Real Property Gains Tax (RPGT) from 0% to 5% for Malaysian individuals.
Secretary-general Datuk Chang Kim Loong said in a statement that the decision to charge 5% for gains on disposal of properties after the fifth year means that Malaysian individuals will have to pay RPGT even though they have “diligently persevered” beyond the five years.
“HBA had in the past called for the government not to change the RPGT rate for the first two properties and to only increase the RPGT rate for the third and subsequent property. This is because most people can only afford to buy two properties, one for own stay and one for long term investment,” he said.
“By charging a RPGT rate for people who have held properties for six years or more, the government is effectively imposing ‘tax on inflation’ and this will be punishing genuine long term investors,” he added.
He urged the government to reconsider the move and to increase the RPGT rate for the third and subsequent property instead.
HBA also disagreed with the stamp duty exemption for first-time home buyers for properties up to RM500,000, saying that the exemption should be restricted to properties priced RM300,000 and below, to ensure the subsidies reach the intended target group.
As for the RM25 million allocated for Cagamas Bhd to provide mortgage guarantees, Chang said this would help prospective house buyers obtain 100% financing.
“Although this proposal will help the house buyer who have problems in coming out with the 10% down payment, HBA urges caution and to ensure that the house buyer can afford to pay the higher monthly installment as a result of getting full 100% financing,” he said.
HBA applauded the government’s move in imposing higher stamp duties on properties priced above RM1 million, from 3% to 4% and urged the government to further increase the stamp duty third and subsequent properties, including those priced below RM1 million.
HBA also supports the move to establish a fund amounting to RM1 billion to assist the lower income group to buy their first home.
“HBA supports this move to help the lower income groups to buy affordable housing by providing interest rates at a subsidised rate. Our sincere hope is that this proposal becomes a reality and not frustrate by time-consuming bureaucracy.
“HBA would urge the government to consider expanding this scheme to include household incomes of up to RM10,000 a month to buy their first property costing up to RM300,000,” said Chang.