Temporary increase in house prices after GST

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ALOR GAJAH: Any increase in house prices upon implementation of the goods and services tax (GST) in April next year is just temporary, as a number of measures are already in place to curtail the rise.

Deputy Finance Minister Datuk Ahmad Maslan said among the measures are increasing the real property gains tax from 15% to 30%, raising the price of houses from RM500,000 to RM1 million for foreigners, and barring developers from undertaking projects based on the Developer Interest Bearing Scheme.

He told reporters this after officiating the closing of a GST information session and a briefing on current issues at the Masjid Tanah parliamentary constituency here yesterday.

Minister of Urban Wellbeing, Housing and Local Government Datuk Abdul Rahman Dahlan said recently that the price of houses can be expected to rise by 3% based on a study by the Real Estate Housing Developers’ Association of Malaysia, after the GST implementation.

Ahmad, however, said the figure could be just 1% to 2% based on the calculation of the finance ministry and the Royal Malaysian Customs Department. — Bernama

This article first appeared in The Edge Financial Daily, on November 17, 2014.