COVER STORY: Replace low cost with affordable housing
TAX BREAKS: Tan Sri Datuk Sri Leong Hoy Kum, Group Managing Director, Mah Sing Group Berhad, shares his wishes for the Budget
To address the escalating pressures of price increases for goods, we hope the Government will consider reducing the personal income tax rate or hike up personal income tax relief to increase disposable income. We hope to see a reduction in corporate income tax as well.
We hope there will not be any policies or requirements which will increase the cost of doing business, and at the same time to introduce measures to reduce compliance cost, ultimately promoting the property market. Some of these measures could include charging tariff-based utilities fees instead of charging new houses, limiting the requirement of land to be surrendered and applying plot ratio instead of density to encourage smaller, more affordable units.
It is proposed that the mandatory delivery of a given percentage of low-costs houses by developers be reviewed, and be replaced by the delivery of affordable homes between RM150,000 and RM350,000 houses as this will also reduce any mismatch in supply and demand for these housing.
We also hope to see more announcements on the implementation of privatisation of government land.
Maintain a favourable RPGT regime which can potentially increase sales and stronger growth of property and housing industry. This is a minimal loss of income to the government as it can be complemented by higher stamp duties received due to higher transactions.
Reduction of stamp duty so that the cost of property and home ownership can also be reduced, thus sustaining affordability levels. We propose that the stamp duty be reduced to 0.5 per cent for first RM300,000, 1 per cent between RM300K to RM1 million and 2 per cent in excess of RM1 million.
It would be good if tax relief is extended to all interest incurred on end financing for the first home. Alternatively, perhaps the government could consider providing grants to first time home owners so that it will be easier for them to own their first property.
We also hope that the government will further ease policies to encourage foreigners to buy properties in Malaysia. As foreign purchasers account for only 2 per cent of property transactions in Malaysia, this will not be a big cost to bear, and at the same time, can project a pro-investment image to the world at large.