KUALA LUMPUR: IN a bid to revitalise the property market and provide financial relief to home buyers, the government has reintroduced the Home Ownership Campaign (HOC) with tax exemptions for the purchase of residential properties.
This HOC reintroduction under the third thrust of the Economic Recovery Plan or Pelan Jana Semula Negara (Penjana) will provide stamp duty exemption on the instruments of transfer and loan agreement for the purchase of residential homes priced between RM300,000 and RM2.5million.
The stamp duty exemption will apply on the instruments of transfer and loan agreements, and will be limited to the first RM1 million of the home purchase price.
Full stamp duty exemption will be given on loan agreements effective for sales and purchase agreements signed between June 1 and May 31next year.
Under this initiative, the government had also decided to provide a Real Property Gains Tax (RPGT) exemption to Malaysian citizens for the disposal of residential homes from June 1 until Dec 31 next year.
The RPGT is a compulsory tax paid to the government when home owners make a profit from the sale of their properties.
Introduced in the 2019 Budget, the RPGT is levied by the Inland Revenue Board.
Effective Jan 1 last year, the RPGT taxes property owners five per cent on chargeable gains from the disposal of assets above RM200,000 after their fifth year of ownership.
In this Penjana incentive, this exemption will be limited to the disposal of three units of residential homes per individual.
It was also announced that the current 70 per cent margin of financing limit applicable for the third housing loan onwards for property valued at RM600,000 and above will be lifted during the period of the HOC campaign, subject to internal risk management practices of financial institutions.
For this initiative, the government has allocated RM1 billion and the initiative will be effective starting this month.
Real Estate and Housing Developers' Association (Rehda) said the Penjana initiative would alleviate the financial burden of home ownership and ultimately contribute to the growth of the economy.