GEORGE TOWN: The Penang Government has been urged to review its parcel rent policy which was introduced early last year.
Gerakan national vice-president Baljit Singh today claimed the state had made "tremendous" profit since the implementation of the policy in January 2019.
An example he cited was a five-storey commercial building in Pulau Tikus on the island standing on 1277sqm of land, where an annual quit rent of RM3,295 in 2018 or RM2.58 per sqm was imposed.
"In 2019 after the parcel rent was implemented, the government has billed more than RM12,000 for the same land to all the parcel owners in the particular block of a building," he said in a statement.
Baljit said based on calculations done, parcel owners were also billed at RM2.58 per sqm for their units.
"One owner used to pay RM62 for their 89sqm-office but is now paying RM230.
"So, if there are more floors in the same building, the government stands to profit more."
Baljit said that quit rent or Cukai Tanah, is deemed land tax.
"Parcel rent or Cukai Petak was supposedly an expansion of the quit rent, meant for the convenience of the people.
"However, it is beginning to look as though a new category of taxation has been imposed on the people and the timing now could not be any worse," he said.
"For owners of high rise buildings, you are now paying for the air space your property is built on. So maybe the term 'Cukai Petak' should be more appropriately known as 'Cukai Ruang Udara' or 'Air Space Tax'."
He said low-cost apartment dwellers have also been affected by this ruling.
"Rifle Range flats, which previously did not require its owners to pay any quit-rent, is now subjected to an annual Parcel Rent of RM25 per unit," said Baljit, adding that since 2019, some 3,699 owners of the Rifle Range flats have begun paying parcel rent.
"The B40 group in Kuala Lumpur's Federal Territories is more fortunate since the quit rent for low-cost and People's Housing Project flats are charged R15 for leaseholds titles and RM20 for freehold titles, irrespective of the size of the units.
"Penang is home to hundreds of high-rise buildings, many of which contain residential dwellings.
"As we are still amid the Covid-19 pandemic and many jobs have been lost, salaries reduced and most people are living in a state of uncertainty, it is timely for the Penang authorities to review the parcel rent policy and lessen the strain and burden experienced by most of the people," Baljit said.