'Assessment cap should remain for years to come'

ELECTED representatives welcome the assessment tax cap but want it to remain for at least the next five years.

Federal Territories Minister Datuk Seri Tengku Adnan Tengku Mansor announced on Tuesday that the assessment amount increase this year for residential properties in Kuala Lumpur would be capped at a maximum of 10%.

This means that owners of residential properties will pay a maximum 10% more in assessment tax compared to last year, while the cap for commercial properties is 25%.

However, Tengku Adnan said the rates might be revised again at the end of this year but it was not mentioned if the cap was permanent.

Setiawangsa MP Datuk Ahmad Fauzi Zahari said it was good news that the capping would significantly reduce the amount of assessment tax increase that was made during the revision exercise by Kuala Lumpur City Hall (DBKL) last year.

“Hopefully, DBKL will use the money to provide the people with better service.

“However, property owners need to budget their finances and DBKL has to be certain on the tax that will be imposed at least for the next five years.

“It is unfair for ratepayers to be shocked by unforeseen increases,” he said.

Titiwangsa MP Datuk Johari Abdul Ghani said he was happy the rate was reviewed as it showed that the Government had taken into consideration the needs of the people.

“However, they have to be fair to residential property owners with regard to property valuation by considering whether the owner occupies the property and that it is not for sale.

“This is because even if the property value appreciates, they are occupying the property.

“So, they do not gain any profit from it as compared to a person who is selling or renting out the place. If the place is highly sought after, the rent will increase and the owner will benefit from it,” he said.

Segambut MP Lim Lip Eng said based on the feedback he received, the public were happy with the capping, as they find the increase reasonable.

“An increase of 10% for residential and 25% for commercial properties is acceptable but it has to be maintained at the same rate for the next five years.

“I hope the FT Minister will explain soon that the cap will indeed remain for the next five years,” he said.

Lembah Pantai MP Nurul Izzah Anwar said while she welcomed the decision to keep the assessment rate increase at a minimum by lowering the actual percentage payable on the assessment value, she had some reservations on the rate itself.

“Granted, the local government, in this case, DBKL has the right to revaluate the assessment value every five years, it is on condition that there are improvements in service and utilities provided.

“Yet, despite lacklustre and inconsistent quality in service and the ongoing rise in the cost of living, DBKL has made no guarantee the assessment rate that is lowered across the board this year would remain as such for the years to come,” she said.

She said there was no guarantee that DBKL would not increase it as soon as next year should they deem the rate as “insufficient” for DBKL coffers.

“It is hoped that whatever measures decided by DBKL, the process of decision-making must be done in the most accountable and transparent manner possible, with adequate engagement with stakeholders, including elected representatives in Kuala Lumpur,” said Nurul Izzah.

Meanwhile, former Wangsa Maju MP Datuk Yew Teong Look welcomed the decision that owners of residential properties will only pay a maximum 10% more in assessment tax compared to last year.

“Although, the cap of 25% for commercial properties is still a bit high.

However, the adjustment to the valuation is needed since the revision has not been done for 20 years,” he said.