GEORGETOWN: Finance Minister Lim Guan Eng has praised the Real Estate and Housing Developers Association (REHDA) of Penang over its move to reduce the prices of houses in the state following the implementation of the Sales and Services Tax (SST).
He said the move by Penang REHDA to reduce the prices of homes by between 6 and 10 per cent is in line with the government’s initiative to provide SST exemption for the construction sector, as announced previously.
He said all housing developers nationwide should follow the example set by Penang REHDA and adopt the same measure, which he said would enable more people to buy their own homes.
“This is a positive step by REHDA in the state. We hope that they can advise other members nationwide to follow in their footsteps.
“This also serves as a reciprocal move for the government’s efforts at providing tax exemption in order to ensure that the prices of houses go down.
“Penang REHDA has also shown that they are a socially responsible corporation as they have not taken advantage of the tax relief, and instead channeled it back to the people,” he told a press conference here on Tuesday.
Also present was Finance Ministry advisor, Datuk Ooi Kok Seng and Penang REHDA chairman Datuk Toh Chin Leong.
Toh had earlier announced that the prices of homes in Penang costing RM300,000 and above would be reduced by 10 per cent, in line with the SST exemption provided by the government.
He said affordable homes costing under RM300,000 would see a six per cent price reduction. This, he said, applies to existing and new projects.
The reduced prices, he said, was made possible as housing developers are now able absorb the cost as they have been exempted from the SST. This, he said, was previously taxable under the previous Goods and Services Tax (GST).
“We also welcome the implementation of the SST because under the GST, developers had to shoulder additional costs, some of which were transferred to the consumer.
“But through the SST, several components of the tax related to construction have been exempted, thus enabling us to reduce the price of houses,” he said.