- Sun
- May 19, 2013
- Updated: 1:38am
Trending topics
Sponsored topics
15 per cent stamp duty
To rein in the city's runaway housing prices, Hong Kong's Financial Secretary John Tsang Chun-wah announced an additional 15 per cent stamp duty on non-permanent-resident and corporate buyers starting from October 27, 2012. The move prompted speculation over the effectiveness of taxation on the real estate market and criticisms that Hong Kong was turning away from its roots as a free market economy in favour of a more protectionist market environment.
Lam made huge profit on property weeks before cooling tax
Franklin Lam denies knowing of new stamp duty when he put Mid-Levels flats on market
In Pictures
 |
 |
 |
 |
 |
 |
Editor's Pick
Man of the moment Riccardo Tisci's dark, sensual designs for Givenchy come straight from the heart, writes Jing Zhang.
Property market analyst turned executive councillor Franklin Lam Fan-keung sold two Mid-Levels properties a few weeks before the government introduced measures to curb property prices last Friday.
And he made the declaration of one of the two properties only four days before changes were announced.
Lam stressed last night that he did not know of the new measures aimed at stabilising prices when he sold the properties. He said he had informed the government he planned to sell some of his properties when he joined the Executive Council in July.
Last Friday, the government imposed a new stamp duty of 15 per cent on properties bought by companies and non-residents.
In another move to curb speculation, the government raised by five percentage points stamp duties on resales of flats. Owners who sell flats within six months of purchase will now pay stamp duty of 20 per cent, up from 15 per cent; between seven months and 12 months, 15 per cent; and between 13 months and three years, 10 per cent. This latter rate extends the period that incurs stamp duty by one year. "This was no case of inside trading … I did not know of these measures when I sold the properties," Lam said.
He claimed to have sold flat B on the 14th floor of Casa Bella at 117 Caine Road at the end of September for about HK$9 million, making a profit of more than HK$5 million. Flat C was sold on the same floor for a similar price and profit on October 10. Both properties are about 800 sq ft. Lam declared the sale of flat B to Exco on October 4, and the sale of Flat C on October 20.
When he joined Exco in July, Lam said he informed the government he planned to sell 10 per cent of his 27-property portfolio. He has been donating his monthly salary as an Exco member to charity to show he intends to use his post only to serve Hong Kong, not to make money.
"I am fully committed to Exco and I don't have a job because of that. To make a living, I made it clear when I joined Exco that I planned to sell some properties," Lam said.
He added that he was not even in Hong Kong on the day the government announced the measures. The other exco members were only made aware of the changes a few hours before the government made the public announcement, he said.
Democratic Party lawmaker James To Kun-sun doubted if Lam really did not know the government was about to introduce measures to curb property prices before he sold the flats.
To said a number of sources had told him that top government officials have informal meetings with Exco members every Saturday.
"I can't rule out the possibility that [Lam] was told of the property measures during those meetings," To said.
Share
- Google Plus One
-
16Comments
Related topics
After reading this article, people also read
5:48pm
If Franklin has any political savvy, and happens to be innocent, this would be a good time to produce documentation to establish his innocence. Trust must be earned, and sunshine reveals truths.
If Franklin drags his a$$, agree there should be an ICAC investigation. It's quite easy - just look into his meeting minutes as a starting point!
3:13pm
Franklin built his weatlh as a property analyst, but he did not always made $$$ nor called the market right. He could make a calculated guess based on figures, but he could never call the market as accurately as he just did ( by selling two flats) just prior to a major political announcement as a property analyst.
Of course, it was insider trading - this time, the insider trader was an exco member acting on privy information. And, don't tell us he did not give any input for (or against) the speculative measures - Franklin is in Exco only by virtue of his expertise and experience in the property market.The "salary" he foregoes is peanuts compared to the valuable inside information available to him ( and his peers) as an exco member.
Also, the government should check his stock trades - he would make much more than his property gains if he shorted the property counters before the announcement. BTW, are Exco members required to report their stock trading?
I do wonder whether there is really such a dearth of talent here that CY is forced to appoint so many in the likes of Mak et al. Of course, the other person with a conflict of interest serving consecutive terms is Cha of HKR/Disco Bay.
Franklin has to go if he is a gentleman like Anthony Leung.
1:14pm
12:22pm
Mr Leung actually offered his resignation over this detail. By selling prior to the new rule deadline, there is no telling how long or at what price the two flats in question would sell for. The ICAC investigated Leung over this incident and was one of the factors that lead to his resignation in July-2003. I wonder whether the ICAC should investigate this matter....
12:03pm
11:38am
By holding 27-properties, having spent a career analyzing and working with the HK property business, you have to believe there is a conflict of interest here in his selfless desire to be an "..Exco member...to show he intends to use his post only to serve Hong Kong."
"I did not know these measures when I sold these properties." Hmm, I wonder about that.
Is he serving the HK people, or his previous masters...the HK Property Tycoons? I'd bet the latter. I'd also bet he wasn't in favour of this new 15% stamp duty for non-residents. Ever the bull-market analyst, Franklin is now part of the largely conflicted HK property developer cheerleading squad in HK government and its corrupt property policy-makers.
I wish CY Leung & his administration the best of luck in containing this runaway property market amidst QE3, QE4 etc. Beyond raising supply, its a tough battle - the real solution eventually is to leave the peg, but that is a non-starter until the RMB goes fully convertible. So we are stuck with non-free market/interventionist policies to cool things down, but as Jake writes, it will come back to bite HK when a bear market starts...
10:22am
8:51am
1:03pm
