Analysts Hail New Property Gains Tax
The Federal Government has taken positive measures to raise revenue without taxing the lower- income group in Budget 2019, says KPMG Tax Services Sdn Bhd executive director Evelyn Lee.
Lee said the government's plan to increase the Real Property Gains Tax (RPGT) for properties to be disposed in the sixth year to 10% from 5% now was less contentious than expanding the base for the capital gains tax.
“This move is designed to increase revenue and not to curb speculation and targeted for assets held more than five years,” she said in a telephone interview after the budget announcement on Friday.
On the proposal to grant Sales& Services Tax exemptions to specific services provided by registered companies to other registered companies, Lee said this would help reduce the cost of doing business in the country.
“The Government, however, needs to release as soon as possible the criteria for the exemptions,” Lee added.
Raine & Horne Malaysia senior partner Michael Geh said the RPGT increase was slight and fair.
“The move will encourage more people to hold properties for their own use for a longer period,” he added.
On the proposal to raise the stamp duty for properties priced above RM1mil, Geh said the increase was mild.
“It won't have a significant impact on the property market,” he added.
Malaysia Institute of Economic Research senior research fellow Shankaran Nambiar said despite the current financial constraints facing the country, the Government was still able toinitiate a well-rounded budgetto look after the lower-income group.
“The proposal for the lower-income group earning not more than RM2,300 per month to own a home of up to RM150,000 will definitely stimulate the housing and construction industry.
“However, the Government needs to give more details regarding the implementation that will make it easier for the lower-income group to own a house,” added Nambiar.
Meanwhile, Small and Medium Enterprises Association Malaysia national secretary S.H. Yeoh said the proposal to allocate an RM4.5 bil SME Loan Fund via commercial financial institutions would enhance the business-friendly environment of the country.
“It is good to have these kinds of programmes to help the SMEs improve their competitive edge. However, the financial institutions disbursing the funds must also cut the red tape involved to expedite the approval for the SMEs.
“We also hope the Government would release more details regarding the loans soon.”