GEORGE TOWN: Penang will lower land tax rates for certain first-grade land designated for business and industrial purposes which do not have planning approvals, says Chief Minister Chow Kon Yeow.
He said such land, which includes sites with temporary structures, depots and lorries, had been reclassified as "building" land instead of commercial or industrial use land.
He added there were more than 800 such cases.
"The new tax rates are 70 sen per square meter for urban land and 50 sen per square meter for rural land," he said during a press conference in Komtar on Wednesday (April 1) adding that this was a major reduction.
Chow said this would involve first-grade land under conditions A, B and C, among others, where there is no planning approval or only temporary structures such as depots and lorry yards.
Previously, some of these lots were assessed under higher commercial or industrial rates ranging from RM2.80 to RM3.25 per square meter.
However, he said landowners under this category would not enjoy the 50% rebate announced earlier, as the reclassification had substantially reduced the tax payable.
Chow said the state government hoped this would help resolve concerns over the increase in land tax.
He also urged landowners to make better use of their land.
"Land is valuable in Penang. If landowners truly want to contribute to the state's development, they should develop their land through proper legal processes so it can help generate economic activity," he said.
Chow said the state had so far received 4,001 appeals on land tax charges as of March 31.
Of the total, 2,885 appeals were related to high tax increases, including those involving first-grade land and cases where land status had changed from rural to urban.
Another 1,116 appeals involved technical issues such as buildings located on two lots, abandoned projects and non-profit organisations seeking adjustments, he said.
He added that 163,262 land account holders, or more than 54% of last year's active taxpayers, had already paid their land tax as of Tuesday (March 31).
The state had earlier announced several relief measures, including a 50% rebate for most landowners, nominal RM50 charges for schools and certain non-profit land, as well as instalment payment options for those facing difficulties.
Under the previous structure, commercial land was charged at RM2.80 per square meter in rural areas and RM3.25 per square meter in urban areas, while industrial land was charged at RM3.25 per square meter. The revised rates had sparked concern among affected landowners, particularly those with older land titles and temporary-use sites, after some saw a sharp jump in the amounts payable.
The sharp increase in land tax had drawn widespread criticism in recent weeks following the state's revised rates.
Among those who had raised objections were Bagan MP and former chief minister Lim Guan Eng, as well as MCA, with both calling on the state to review the rates.
The state government said land tax rates had not been reviewed for about 30 years, with the last revision made in 1994.
