Thursday, November 22, 2018

RPGT Should Not Be Calculated From Year 2000 But 2013




Our Finance Minister clarified that RPGT would only be calculated from year 2000 onwards. We also have to remember that, in 2007-2009 the property market needed stabilisation and PM Badawi suspended RPGT from April 2007 till December 2009.

 The move, was it to allow people to sell at a profit without RPGT??!! NO!!! It was to encourage people to buy then. Hence to say that all RPGT will be calculated from year 2000 is grossly unfair. 

 Here we are only arguing over the just implemented 5% RPGT for properties held for more than 5 years. Hence the more than 5 years should be worked back from 2018, which is for properties bought on or after 2013.

YESTERDAY
By Hidir Reduan Abdul Rashid - November 21, 2018 @ 11:06pm
KUALA LUMPUR: The Real Property Gains Tax (RPGT) valuation on property would only be calculated from the year 2000 onwards, says Finance Minister Lim Guan Eng.
He said that this is done to give clarity on the issue following feedback from concerned property owners who have bought and owned land extending decades before 2000.
“On RPGT, the government previously announced rise to five per cent, but (the ministry) had received feedback that the cut-off date of evaluation was not set.
“There were parties that raised concerns that if the property was bought since 1960 and later sold, how much is the tax that they need to pay.
“Therefore, the ministry had set the date of valuation to begin from the year 2000 despite the land being owned since 1960. It would only be valued from 2000,” he said at the Dewan Rakyat during his wrapping-up speech on 2019 Budget at the Dewan Rakyat today.
Previously when tabling 2019 Budget, Lim said the government raised the RPGT to five per cent.
However, this tax is exempted on low-cost houses and affordable housing priced below RM200,000, among others.

 MEANWHILE BACK IN 2007
PETALING JAYA: Prime Minister Datuk Seri Abdullah Ahmad Badawi, who announced the scrapping of the real property gains tax (RPGT) from April 1, hopes the move would “inject more excitement and dynamism to both the property and financial sectors.” 
Speaking at Invest Malaysia 2007 yesterday, Abdullah said the abolishment of RPGT would improve the property sector.  
He said it was among the immediate measures intended to further increase and facilitate investments in the country. 
Property companies and analysts welcomed the news. They said it would benefit the sector, especially the high-end segment. 
OSK Securities analyst Mervin Chow told StarBiz: “We will definitely see an increase in the earnings prospects of property companies, either through an increase in demand or sales values. But it is very hard to quantify the extent at this juncture. 
“We will also see increased foreign buying interest in Malaysian properties.” 

 managing director Datuk Leong Hoy Kum said: “It is heartening that the Government has been so proactive in promoting an investment-friendly regime to enhance local investment, and draw foreign direct investment to Malaysia.”
He said Mah Sing would be a direct beneficiary of the RPGT abolishment, having established a premium branding for its lifestyle products in the Klang Valley and Johor Baru. 
“We are in the right segment and locations. The Government's announcement is timely and we anticipate this feel-good factor will be an additional crowd-puller for our preview of Hijauan Residence this weekend.” 
 property divisional director Jauhari Hamidi hailed the tax waiver as the “best news” for the property industry, homebuyers and investors, because it “will revive the market which has been soft in recent years.”
“The abolishment will help create more excitement in the property market.  
“As for our newly-launched Ara Hill project, the move will encourage earlier upgrades among the growing affluent,” he said. 
 chief executive Shah Hakim Zain said the move would further attract foreign investments, while former Road Builder (M) Holdings Bhd executive vice-chairman Tan Sri Chua Hock Chin said it would spark interest in the secondary property market.
Sunway Group founder and chairman Tan Sri Jeffery Cheah said the move would help attract more foreign buyers to the group's properties. 
 Bhd managing director Shahril Ridza Ridzuan told reporters that the scrapping of the property gains tax would encourage more secondary trading and liquidity in the secondary property market.
And IJM Corp chief executive Datuk Krishnan Tan said the lifting of the RPGT would benefit property investors and developers would see improved demand for property. 
Tan did not expect an immediate impact on companies' bottom line. 
Despite the mostly positive sentiment, some fund managers think the tax waiver could encourage speculation and increase property prices. 
They also said the lower income group could be hurt as it would be more difficult for them to own properties. 
A fund manager said: “Property prices could surge when speculative activities start. Lower income people could bear the brunt, especially if their salaries do not increase as quickly as property prices.”

Read more at https://www.thestar.com.my/business/business-news/2007/03/23/major-boost-for-high-end-property/#10Gik3wyPO0tvtHq.99h

`````````````````````````````````

 Real Property Gains Tax (RPGT) is a form of Capital Gains Tax that is imposed on the disposal of property in Malaysia. It was suspended temporarily in April 2007 to December 2009, and reintroduced in 2010. In 2014, the RPGT was increased for the fifth straight year since 2009. Now, there's a revision to the RPGT for 2019 in the latest Budget.

 There are some exemptions allowed for RPGT. Among the exemptions are:
  1. Exemption on gains from the disposal of one private residential property once-in-a-lifetime to individual (please utilise this once in lifetime opportunity wisely).
  2. Exemption on gains arising from the disposal of real property between family members (e.g. husband and wife; parents and children; grandparents and grandchildren).
  3. 10% of profits OR RM10,000 per transaction (whichever is higher) is not taxable.
on

No comments:

Post a Comment

Subscribe to: Post Comments (Atom)