Friday, March 1, 2013

Luxury home tax unlikely in HK: experts


Feb 27, 2013 - PropertyGuru.com.sg

Although Singapore has announced tax hikes on high-end investment homes, Hong Kong is unlikely to follow suit, noted analysts and reported by the South China Morning Post.

According to Jennifer Wong, tax partner at KPMG China, the private housing market in Hong Kong “is a lot bigger than that of Singapore, and many people could be affected if the Hong Kong government follows suit”.

She said there are over 1.1 million private homes in the territory and it would be difficult to differentiate those that fall under the luxury category.

With many units in urban areas and the New Territories valued at HK$10 million (S$1.59 million) or more, the general public might suffer if the government implements higher taxes.

Even if luxury homes were defined as being priced from HK$30 million (S$4.79 million), this would lead to speculation below that price level, Wong added.

Edward Farrelly, Research Head for Hong Kong, Macau and Taiwan at CBRE, said: “The introduction of what is in effect a wealth tax would run contrary to Hong Kong's position as a low-tax location.”

“Neither is it certain that such a tax would alleviate pressure in the residential market. As we have seen with the introduction of previous policy measures in Hong Kong, the market reacts very quickly to establish a new equilibrium, and the effect on pricing beyond the short-term is minimal.”


Martin Koh | 86666 944 | R020968Z
Sherry Tang | 9844 4400 | R020241C

Senior Sales Director
DTZ Property Network Pte Ltd (L3007960A)
Email: marshe_inc@yahoo.com.sg

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