THE local councils in Penang have not reviewed the annual value of properties for assessment rates since 2005.
Penang Island City Council (MBPP) and Seberang Prai Municipal Council (MPSP) decided to re-value properties next year.
Chief Minister Chow Kon Yeow said that under the Local Government Act, such valuations must be reviewed every five years.
“So if we do not do a review and implement it next year, then one day when it needs to be done, the rate will be much higher.
“Next year’s increment was conducted prudently with a minimal impact to about 75 per cent of ratepayers who needed to only pay below RM100 annually, ” he said when asked to comment on the assessment rates to be increased next year.
He was speaking after opening the new ‘waste–to–eco-friendly’ products manufacturing plant of Heng Huat Group in Sungai Bakap near Nibong Tebal on Saturday.
He also explained that the review was on the annual value of properties, shown as ‘Nilai Tahunan’ on the assessment bills, which has not been reviewed for 15 years.
The assessment rate itself, he added, is reviewed yearly.
“We hope ratepayers understand that they have been paying low taxes over the past 15 years.
“Even if I don’t do it, the other chief ministers after me will have to do it.
“The monies collected by both the local councils will be returned to ratepayers in terms of more infrastructure projects, ” Chow said.
He said that for businesses, any increase in revenue is deemed as profits but the local councils see revenue increase as surpluses to carry out various projects planned.
On Friday, state local government, housing, town and country planning committee chairman Jagdeep Singh announced the rates were reviewed in accordance with Section 137(3) of the Local Government Act 1976.
Jagdeep said MBPP and MPSP had been recording an annual deficit budget since 2016.
He, however, said the state’s new assessment rates for 2020 would still be the lowest in the country compared with other states.
“It is still the lowest if we compare with other properties in Kuala Lumpur, Petaling Jaya, Shah Alam and Subang Jaya, ” he said.
Assessment rates can be paid twice a year by all property owners in the state.
Jagdeep said notices of the increase of assessment rates had been sent out to all property owners.
“We have given them an opportunity to submit appeals until Oct 14, ” he said.
Jagdeep also said the rate increase would garner additional revenue for MBPP and MPSP next year.
He added that MBPP could expect to gain an additional RM54,338,822 while MPSP would see an additional RM39,743,077.02.
“Several infrastructure projects will be implemented by both councils between 2020 and 2022, ” he said.
But several groups are not happy with the increase.
Penang Gerakan vice-chairman H’ng Khoon Leng said the increases would be more than 30% and it would heavily impact the B40 low-income group.
“The government should look into cutting wastage in administration rather than pushing the burden onto the people.
“If they have been recording budget deficits for years, they need to improve their operation, ” said H’ng.
He showed samples of assessment bills received by property owners in George Town, indicating that annual valuations had nearly doubled, even though the chargeable rate dropped by a few percent.
This caused a houseowner in Weld Quay, for example, to pay RM143 now instead of RM111 previously. The rate for a low-cost flat in Macallum Street Ghaut is now RM54 instead of RM37.20 previously.