Lower real property gains tax to zero, urges Rehda

Rehda believes there will be delays in completion of development projects as construction work has been put on hold due to the movement control order (MCO). — Filepic

JOHOR BARU: The Johor Real Housing Estate and Developers Association (Rehda) has urged the Federal Government to lower real property gains tax (RPGT) to zero percent following the Covid-19 pandemic.

Johor Rehda branch chairman Datuk Steve Chong Yoon On said that reducing the RPGT rates to zero percent for the next one or two years would help the housing sector here.

“Covid-19 has affected everyone and the property sector is expected to feel the pinch even more as people have less disposal income and are saving what money they have.

“We will see delays in completion of development projects as construction work has been put on hold due to the movement control order (MCO), which the government has extended until April 14,” he said when contacted.

He also urged the state government to release more unsold bumiputera lots as well as reduce the threshold for foreigners to buy property in Johor, which is currently set at RM600,000.

“This will help developers in overcoming the issues we are facing due to Covid-19, and will hopefully help spur the local property sector,” he added.

The government announced an RPGT of between 30% and 5% under Budget 2019, depending on how long the property is owned before being sold off.

The RPGT imposed on Malaysians is 5% if the property is sold after the fifth year. The tax goes up to 30% if the property is sold in three years or less.

Under Budget 2020, the government revised the RPGT imposed on the disposal of properties after five years by setting the market value on Jan 1, 2013, as the property acquisition price for properties acquired before the said date, compared to the current base year of Jan 1, 2000.

In essence, property owners will have to pay less tax, especially those who bought the property before Jan 1, 2000.

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