The goods and services tax (GST) should be implemented gradually since it will have an adverse impact on the affordability of houses, proposed the Real Estate and Housing Developers Association Malaysia (REHDA). To be implemented from 1 April 2015, the six percent GST is quite high and a burden to consumers, said its Finance and Investment Committee Chairman, Datuk Ng Seing Liong at yesterday’s media briefing on ‘GST – Impact on the Housing Industry’. Aside from that, the GST will also lower the developers’ margins, he noted, adding that REHDA has already forwarded its proposal to the government. “REHDA has requested the Finance Ministry give serious consideration to the proposals as the implementation of GST in its current form will cause financial hardship, adding to the costs of development resulting in overall increase in house prices and will be eventually passed on to the buyers,” he said. Notably, REHDA is asking the government to expand the zero-rated goods and services to include major cost components of property development projects such as iron, steel bars, concrete, aggregate sand and cement, or consider provisions that would grant some relief to the suppliers in order to help them with cash flow issue. The stamp duty on transfers of real property should also be retained at its current maximum of three percent instead of the proposed four, said Ng. REHDA also wanted the government to allow developers to adopt a fixed allocation – either land area (acreage), built-up or any method (segregation between commercial and residential property development) – when claiming residual input tax credits. Ng noted that the imposition of GST would translate to additional cost considering that there are already multiple taxes imposed like real property gains tax, Construction Industry Development Board levy and service tax.
Posted on: Wed, 12 Mar 2014 07:12:41 +0000
Trending Topics
Recently Viewed Topics
© 2015