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Stamp duty
rise raises hackles
07/06/2009 The
Star
PETALING JAYA: Housebuyers and owners have joined construction players in
asking the Government for an exemption of the new stamp duty on
construction contracts, or at least a delay.
“This is a burden,” says G. Thanalethumi, a 73-year-old homemaker, who
intends to renovate her house this month.
“Now I have to save up more. I am unemployed and it’s going to take a
while longer to get enough money to rebuild my house.”
She was responding to reports that the increase in stamp duty, effective
Jan 1, from the nominal RM10 to a 0.5% of the contract value, would be
passed on to the end consumer. Construction costs will now go up by
between 1% and 2%.
At a press conference on Friday, Master Builders Association Malaysia
president Ng Kee Leen had said the association felt that construction
contracts were not service agreements and therefore should not fall within
the scope of “services” under the Stamp Duty Act.
He added that he would raise the matter with the Government at a dialogue
with the Finance Ministry on Thursday.
Store manager Olagnathan Ramasamy, 49, who retired from the army,
suggested the increase be delayed until the economy had improved.
“As buyers, we are already burdened by having to pay the loan interest and
lawyer fees, This increase in stamp duty will be another reason for real
estate dealers to raise the price of properties,” said Olagnathan who was
planning to buy a second home.
“It is difficult for us to cope with this in the current economic
situation, with
the rising cost of living. I hope the Government can make an exception by
delaying this, at least until the economy recovers,” he said.
His views were shared by Premadevan Sagadevan, 25.
“It should be postponed by at least five to six years,” said the bank
officer, who has put back his plans to buy a house.
“Otherwise, I might end up paying more interest to the bank,” he added.
Michael Chin Woon Yew, 41, who has worked as a real estate negotiator for
12 years, said the rise in stamp duty would affect the property buying
rate.
“The market is still soft,” he said, adding that the buyers’ wait-a-see
attitude would affect real estate agents, too.
Industry player Ng Teck Hua, 52, who owns Teck Hua Construction and
Renovation, said home owners might delay renovating the homes.
“It is okay to amend the Stamp Duty Act, but it would be better if the
Government can guarantee a reasonable profit return for the construction
and renovation sector,” said Ng.
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