13 August, PETALING JAYA: Cheaper house prices are expected in the future with basic building materials and construction services to be exempted from the Sales and Services Tax (SST), according to Lim Guan Eng.
The Finance Minister said this impact is also expected to be felt in the construction of industrial and commercial buildings nationwide.
He pointed out that under the Goods and Services Tax (GST) previously, materials such as bricks, cement, sand and other basic construction items were subjected to the six percent tax, leading to increased property prices.
“In addition, construction services were also subjected to the 6% GST. This has led to increased construction costs under the GST era, including the increase in house prices.
“The pressure on house prices, industrial and commercial buildings are expected to be eased by the abolition of GST and the exemption of SST,” he said in a statement yesterday.
“The government hopes that construction costs can be reduced with the exemption of SST,” he said, adding that some of the materials to be SST-exempted were cement, sand and iron.
Lim said with the proposed move (to exempt SST), both developers and buyers could benefit from the reduction of the tax burden.
The Pakatan Harapan government, in its election manifesto, has promised to abolish GST and reintroduce SST in its bid to reduce the cost of living burden of the rakyat.
Parliament had last week passed the bills to abolish GST – which is now zero-rated – and introduce SST, with both bills now to be tabled in the Dewan Negara before being consented by the Yang di-Pertuan Agong and gazetted.
Lim had previously said that a total of 5,443 items would be exempted under SST, over 10 times more than the 540 items exempted under the previous tax system.
– THE SUN