(From left) Penang Chief Minister Chow Kon Yeow and Penang land and mines office director Faizal Kamarudin speaking to the press during a press conference at KOMTAR. ( September 17, 2025 ) — LIM BENG TATT/The Star
GEORGE TOWN: Almost 400,000 home and landowners in Penang will have to pay more in quit or parcel rent, locally called cukai tanah and cukai petak, from 2027.
This follows a state government move to redraw 10 town boundaries and gazette 25 densely built areas as townships instead of villages or rural areas.
“Many of these areas have all grown into thriving urban centres but they are still officially gazetted as village land,” said Chief Minister Chow Kon Yeow.
The exercise, which was gazetted on Sept 4, marks the most sweeping reclassification since 1966.
A total of 210,000 land titles and 184,000 strata titles are directly affected by the amendments.
The 10 expanded townships are Bayan Lepas, Balik Pulau, Batu Ferringhi, Tanjung Bungah, George Town, Bukit Mertajam, Sungai Bakap, Nibong Tebal, Kepala Batas and Butterworth.
The 25 newly created townships are Bayan Baru, Batu Maung, Sungai Ara, Pulau Silikon, Bukit Jambul, Puncak Penara, Perdana Mutiara, Pinang Emas, Bayu Emas, Lembah Perai, Alma, Bukit Minyak, Bukit Tengah, Bandar Perda, Seberang Jaya, Jawi, Bandar Cassia, Simpang Ampat, Bandar Tasek Mutiara, Sungai Dua, Teluk Air Tawar, Bertam, Tasek Gelugor, Pokok Sena and Ara Kuda.
The amendments mean that owners of these properties will see new quit rent and parcel rent rates from next year. However, to cushion the impact, the state will defer the new parcel tax rates for strata properties until 2027.
“These changes are necessary to realign land use classification with the rapid pace of development.
“The deferment will benefit more than 300,000 strata parcels in Penang, all of which will continue paying existing rates for one more year,” Chow said.
He said the reclassification ensures those living in areas that already enjoy urban infrastructure and services contribute fairly in line with the benefits they receive.
According to PLANMalaysia, a town is defined as a gazetted area and its built-up surroundings with at least 10,000 residents, or smaller areas where at least 60% of adults work outside of the agriculture industry.
In Penang’s settlement hierarchy, George Town is recognised as a regional city, while Balik Pulau, Batu Kawan, Bandar Cassia, Bayan Baru, Bukit Mertajam, Butterworth, Kepala Batas and Nibong Tebal are listed as principal towns.
There are 31 local towns, such as Batu Ferringhi, Tanjung Bun-gah, Tanjung Pinang, Ayer Itam, Bayan Lepas, Bertam, Tasek Gelu-gor, Telok Air Tawar, Seberang Jaya, Prai, Simpang Ampat, Sungai Bakap, Juru and Jawi.
Chow said the reclassification took into account criteria such as population density, geography, environmentally sensitive areas, brownfield sites, lot boundaries, road alignments and economic potential, although the state was not legally bound to apply them.
“This is part of a plan to improve district administration and development planning by 2030. At the same time, it will strengthen state revenue management,” he said.
The Chief Minister said the move was long overdue as the last gazetting of towns was done nearly 60 years ago, at a time when Penang was largely agrarian.
“This exercise brings our classifications up to date with present realities,” Chow said.
