Opposition to Hong Kong property stamp duty rise grows vocal

Interest groups are increasingly expressing their opposition to the government's plan to double stamp duty on property transactions.

The Canadian Chamber of Commerce on Wednesday hosted a panel discussion that rejected the need for the tax increase. Participants objected to the proposed increase in duty because companies buying office units for their own use would be affected.

The issue gained attention yesterday when thousands of real estate agents and workers in the property-related industry, such as interior decorators, marched to the government headquarters at Tamar in Admiralty to protest against property market curbs they said had affected their livelihoods.

Since the government said in February it would double stamp duty on purchases of residential and non-residential property valued at more than HK$2 million, sales of commercial properties have fallen more than 80 per cent from their February peak.

Corporate governance activist David Webb said doubling stamp duty on purchases of commercial properties was a "volume suppression" measure, adding that higher transaction costs reduced economic flexibility.

Speaking at the Canadian Chamber of Commerce's panel discussion, Webb said the proposed doubling of stamp duty was unconstitutional and bad policy, adding that it might punish people for exercising their Basic Law right to acquire, use and dispose of property, as enshrined in Article 105.