Call to sting property speculators with extra stamp duty

HONG KONG: The head of an influential think tank says property sellers who engage in speculative activities should be made to pay hefty stamp duty.

Anthony Wu Ting-yuk, chairman of the Bauhinia Foundation Research Centre, said the government should impose a new stamp duty on apartments that are sold within six months to one year after they were last purchased.

At present, only the buyer pays the stamp duty, not the seller. And even though the seller may be exposed to profits tax under the current law, that tax is rarely imposed.

Wu said the profits tax — or what he called property-trading tax — should be more strictly enforced.

"The stamp duty in those cases must account for a substantial proportion of the profit gained from the transactions," he said.

Wu, who is chairman of the Hong Kong General Chamber of Commerce, said the government should also consider waiving stamp duty for eligible first-time homebuyers who live in their property for two or more years.

Wu's remarks came as the government deliberates when to introduce fresh measures to cool the property market.

Those measures include increasing the rate of stamp duty and tightening mortgage lending.

The foundation has close ties with the government, and its policy recommendations are often adopted.

A person familiar with the government's stance on the matter said new measures could be rolled out by the end of the month.

Financial Secretary John Tsang Chun-wah said on Monday that the government was monitoring the property market and would announce appropriate measures relating to it when necessary.

At present, stamp duty on the sale of properties valued at less than HK$2 million (RM800,887) is HK$100. Stamp duty on properties valued at more than HK$2 million is HK$100 plus 10% of the amount exceeding HK$2 million. The duty increases to HK$45,000 plus 10% for properties valued at more than HK$3 million — up to the rate for luxury homes that are valued at more than HK$20 million, which is 4.25%.

Wu also said his research centre was conducting a study on population policy, which would recommend raising the retirement age and providing incentives for couples to have babies.

"The chief executive said three years ago that he hoped our population would grow to 10 million. Where will the extra three million people come from?" Wu said, adding that Hong Kong must come up with measures to lure more professionals to the city.

As chairman of the Hospital Authority, Wu will mark the 20th anniversary of its establishment today.

He said one of the major achievements of the authority in recent years was to become more transparent in its engagement with staff and the public.

"We have nothing to hide, even when medical blunders in public hospitals are discovered," said Wu, who was appointed authority chairman in 2004. — South China Morning Post
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