The 5% real property gains tax (RPGT) announced during the 2010 Budget last October will now only apply to property sold within 5 years from the date of purchase. Finally, our Prime Minister listen to the complains from the many property buyers which stress their unhappiness through many medium such as newspaper and blogs.
This is indeed a very good news to property buyers or investors in Malaysia.
Prime Minister said that the decision would cause the Government to lose about RM200mil in revenue. However, the benefit of this decision country we will see a stronger growth in the property sector.
In Malaysia, real property gains tax (RPGT) is imposed with the intention to curb property speculations. It is imposed on the gains on disposal of Malaysian landed properties and the rate varies from 5% to 30% depends on the holding period.
With effect from April 1, 2007, the Government decided to exempt RPGT in view of the economic slowdown and it was aimed at assisting property developers in disposing of their houses, and spearheading the economic progress.
Prime Minister Datuk Seri Najib Tun Razak, who is also Finance Minister, on Oct 23, however, reintroduced RPGT to put in place a fair administration of taxes.
Following from the budget announcement form Prime Minister last week, a lot of confusion regarding the Real Property Gain Tax. Is it 5% flat or depending on the year of selling?
Malaysian Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah clarified that the Real Property Gains Tax, effective January 1 next year, is fixed at 5 per cent, irrespective of the property disposal year.
This rate of 5 per cent will be implemented through the Real Property Gains Tax (Exemption) Order 2009. This Order will be gazetted as soon as possible and is effective January 1, 2010.
On 23rd October 2009, Prime Minister Datuk Seri Najib Tun Razak has tabled Budget 2010 with the theme “1Malaysia, Together We Prosper”.
These are the main highlights that interest me in the area of Personal Finance
- 5% property gain tax will be imposed on gains from the disposal of real property from Jan 1, 2010. Existing tax exemption will be retained for gifts between parent-child, husband-wife, grandparent-grandchild.
- A service charge of RM50 a year to be imposed on each principal credit card and charge card and RM25 a year on each supplementary card including those with free for life effective from Jan 1, 2010.