5 October 2017, Petaling Jaya – AmBank Research (AmResearch) said Budget 2018 could see some measures to support home buyers, including allowing Employees Provident Fund (EPF) contributors to withdraw a maximum of 50% of their funds in Account II to purchase houses, up from 30% currently.
AmResearch chief economist Anthony Dass said in a note today the incidental costs of owning an affordable home will likely be reduced by extending the full waiver of stamp duty for first-time house buyers beyond Dec 31, 2018, and raising the threshold to a maximum of RM500,000 from RM300,000 currently.
In addition, he said, the research house believes the government will likely retain the existing Real Property Gains Tax at 30%, 20% and 15% for properties sold within the third, fourth and fifth anniversary of the purchase respectively to curb speculative activities in the property market.
“We expect a focus on the commercial viability of affordable homes with targeted measures and waivers to support property developers,” he added.
On another note, Dass said AmResearch sees a low possibility for another tax increase on tobacco and tobacco products in Budget 2018, which will be tabled in Parliament on Oct 27 by the prime minister, who is also finance minister.
Dass said further increases in excise duties will only elevate illicit trades at the expense of legal sales, which will hurt rather than boost the government’s tax receipts from the industry.
Meanwhile, the auto sector, which is hurt by high input costs due to the ringgit’s weakness, could get relief in the form of further tax exemption for localisation, and a reduction in excise duties and/or import duties.
Dass said these savings could help lift carmakers’ margins from the doldrums, as well as lower car prices to stimulate demand.
“While the current incentives on hybrid and electric vehicles play a role in contributing to a cleaner environment, the impact is very limited given that hybrid and electric vehicles in the market currently are largely premium models that sell in low volumes.
“We believe the incentives may be extended to include more mass-market energy-efficient vehicles (EEVs). After all, EEVs offer lower emissions and better fuel efficiency.”
For the financial sector, Dass said AmResearch hopes the government will extend the 20% stamp duty exemption on the principal or primary instrument of financing in accordance to syariah principles, and further tax incentives for loan instruments under syariah principles, particularly for small and medium enterprise borrowers.
– THE SUN
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