High property taxes to blame for Selangor’s high cost of living, says economist

PETALING JAYA (Dec 26): High property-related taxes and other rates imposed by the Selangor government have driven up the cost of living in the state, said political economist Isham Jalil.

Isham, who had served in the Economic Planning Unit in the Prime Minister’s Department, said the state government’s revenue had gone up after it raised property-related taxes when the opposition took over after the 2008 general elections.

He also claimed that rental for night market lots had increased, forcing traders to raise the prices of goods.

The higher costs have squeezed businesses, which eventually led to adverse effects on consumers, he said on Bernama News Channel’s “Ruang Bicara Khas” programme hosted by Sherkawi Jirim, the national news wire reported.

“This has led to the high cost (of living), especially in the city areas,” said the Harvard University graduate.

He further claimed that the property-related taxes in Selangor, and Penang – where the opposition also took control of the state government following the 2008 general elections – were not as high when Barisan Nasional (BN) was in charge.

“That's why I always mention that the BN-led government is always (good) for growth and is business friendly. As for the opposition-led state governments, they are bad for the economy, business and the people,” he said.

He also claimed that the development expenditure of both states is smaller compared with during the BN administration.

Isham said the government was aware that the Chinese community – who mostly earn their living through business – was concerned about the economy, the cost of doing business, and the cost of living.

Thus, the government had set up a special Cabinet committee to study and tackle the rising cost of living, he added.