August 27, 2013 / 7:57 AM / 4 years ago

Malaysia weighing hike in property gains tax to stabilise housing prices-report

KUALA LUMPUR, Aug 27 (Reuters) - Malaysia’s government is exploring the possibility of hiking the real property gains tax (RGPT) to rein in rising housing prices and curb speculation in the market, state news agency Bernama reported on Tuesday.

Bernama quoted Housing Minister Abdul Rahman Dahlan as saying current property tax levels had failed to stabilise house prices with the house price index continuing to rise.

“As far as I‘m concerned, we’re studying the possibility and if it can cool down the market, it would be on the table,” Abdul Rahman was quoted as saying.

The minister declined to confirm to Bernama if the tax proposal would be included in the 2014 budget which will be unveiled in October.

Malaysia last raised the RGPT in 2012 to 15 percent from 10 percent for properties sold within two years of purchase.

It also raised RGTP to 10 percent from 5 percent for those sold between two and five years, which analysts had called “too feeble” to cool a jump in housing prices.

Abdul Rahman said the housing price index recorded the highest increases in 2011 and 2012 over the past five years, especially in some states in peninsula Malaysia and in Sabah state in Borneo island.

Analysts have said another hike in RPGT could dent property counters from UEM Sunrise to Mah Sing Group, who are exposed to the high-end and luxury segments targeted by property speculators. (Reporting By Yantoultra Ngui; Editing by Niluksi Koswanage & Kim Coghill)

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