How will GST affect the secondary property transactions? Do you already know? If you do not know, you may want to ask your real estate agents. The only issue is, even your real estate agents may not know. According to the Malaysian Institute of Estate Agents (MIEA) president Siva Shanker, he hoped that the Customs Department to clarify GST requirements and issues and how it would affect investors. Thus far the focus has been more developer based while for the secondary market no one knows anything.
He said, “How it is going to affect secondary properties? How is it going to affect the individual owner who only has one shoplot, one office lot or one factory to sell? How do you pay, how much do you pay, when do you pay, who do you pay to, at which point do you pay? There are so many questions and nobody has answers.” Some examples were then quoted by KP Bose Sdn Bhd tax consultant KP Bose Dasan. He asked, “If I own a shoplot worth RM2 million, should I register? If I’m renting it out now for RM100,000 per year, am I subject to GST even if the rent does not reach the threshold of RM500,000 per year? If I want to sell it do I collect GST from the buyer if the selling price is more than RM500,000?.”
These are very valid questions and I think it deserves more media attention so that the authorities would be more forthcoming in engaging with these stakeholders. After all, secondary properties account for majority of all transactions and not the primary ones. In fact, make all these information transparent and all medias should be reporting it too. Investments require a positive sentiment. Where positive sentiment is not available, there should be at minimum certainty. The worst would always be negative sentiment plus uncertainty.
written on 20 Feb 2015
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