Govt expects changes in housing prices after SST exemption
GEORGE TOWN: The federal government expects a more positive response from housing industry players following its decision to exempt construction services and certain building materials from the Sales and Services Tax (SST).
Finance Minister Lim Guan Eng expressed hope of seeing at least some changes in housing prices as the government was not collecting SST for construction services.
He noted that car prices had dropped since the implementation of the SST and there should be a positive response from the housing sector as well.
“We hope there is at least some changes in housing prices and we expect to see a positive response in the future,” he told reporters here yesterday.
He was responding to a report in an online news portal which quoted the Real Estate and Housing Developer Association ( REHDA) Penang immediate past chairman Datuk Jerry Chan that house prices were unlikely to fall even after the government’s announcement of exemption of certain building materials from SST.
Lim, who is the member of Parliament for Bagan, said the government would also review the current corporate tax rate in order for the country to maintain its competitiveness in this region.
Expressing his personal point of view, Lim said he had no intention of raising the corporate tax rate but the country’s current financial situation made it difficult for the government to decide the matter. “We notice that neighbouring countries have reduced their corporate tax and even the Americans have reduced theirs from 35 per cent to the current 21 per cent.
“Based on the country’s current financial situation, if we are capable of reducing it, then we will reduce the corporate rate; but if not, we will consider other options,” he explained.
He said the announcement of the new corporate tax rate would be made during the tabling of Budget 2019 by Prime Minister Tun Dr Mahathir Mohamad in Parliament on Nov 2.
Earlier, Lim and Customs Director- General Datuk Seri T Subromaniam attended an SST briefi ng with the industry players here.