‘No’ to proposed Stamp Act amendment
KUCHING: Sarawak Housing and Real Estate Developers’ Association ( Sheda) opposes the federal government’s proposal to bring forward the ad valorem stamp duty for Sale and Purchase (S& P) Agreement, resulting from the proposed amendment to the Stamp Duty Act 1949.
In a press statement yesterday, Sheda said in practice nowadays the ad valorem stamp duty, whether by Memorandum of Transfer (for first purchaser with individual/strata title) or Deed of Assignment (for subsales without
House purchasers are currently struggling with the more difficult loan approval measures and the market is facing more than 50 per cent loan rejection by banks.
individual/strata title), was borne by the end purchaser.
But due to the lengthy time needed for individual/strata title to be issued in Sarawak, this hefty stamp duty is only taken up years after the signing of the S& P Agreement.
Sheda president Joseph Wong expressed concern that the proposed upfront imposition of ad valorem stamp duty at S& P Agreement stage would impose more financial hardship on house purchasers, especially those who already have to deal with a significant down payment of 1030 per cent of the purchase price, depending on their loan application outcome (if successful).
“House purchasers are currently struggling with the more difficult loan approval measures and the market is facing more than 50 per cent loan rejection by banks.
“The current rate of stamp duty for S& P agreement or Deed of Assignment is 1 per cent (for the first RM100,000), 2 per cent ( for RM100,001 to RM500,000), 3 per cent (for RM500,001 to RM1,000,000) and 4 per cent (over RM1,000,001).”
He said a purchaser of a RM500,000-house would be charged an upfront stamp duty of RM9,000 on top of the legal fee for the S& P agreement.
“In addition, the house purchaser will have to pay the stamp duty and legal fee for the loan agreement to part finance purchase of the house,” he added.
Sheda thus hoped Sarawak MPs would raise the matter with the federal government and reject the proposal.
This would ease the financial burden of fellow Sarawakians, especially those purchasing their first homes.
Joseph Wong, Sheda president