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.
Agents say their business hit by cooling policies
Heavyweights from the industry turn out to urge the government to withdraw extra stamp duties
An alliance of property agents against the government's market-cooling measures said they hoped to collect 200,000 signatures in a month to urge withdrawal of the policies.
After organising a rally against the measures last month, attended by thousands, the alliance said yesterday that if the government maintained its double stamp duty, they would consider "more radical moves", including camping outside government headquarters in Admiralty.
Currently double stamp duty is levied on buyers of residential and non-residential properties, except Hong Kong permanent residents who do not own a flat.
This measure and another two - a 15 per cent buyer's stamp duty on foreign and corporate buyers of residential flats, and a special stamp duty on the resale of flats within 36 months - have already taken effect, but lawmakers can still veto or introduce amendments to bills on the measures, which have yet to be passed by the Legislative Council.
The alliance, led by Hong Kong Real Estate Agencies General Association chairwoman Chu Kin-lan, Centaline founder Shih Wing-ching, and Midland Realty's managing director Pierre Wong Tsz-wa, said people could leave their signatures at one of more than 4,000 shops. They hoped lawmakers would veto the government's bill or introduce drastic amendments.
Shih said the double stamp duty had forced the number of transactions down and was unnecessary, and that Centaline would barely maintain its current scope of operations if the situation continued. "We will have to lay off people then," he said, adding many agents had left the industry already.
"The policy is not beneficial to Hong Kong. Foreign investors may think the city is no longer a suitable place to invest."
Wong said the double stamp duty had not met its objective of increasing transactions and lowering prices for first-time buyers.
Tony Kwok Tak-leung, chairman of the Property Agencies Association, said he expected one-third of agencies to close if the measures continued. "Then more than 10,000 people would lose their jobs."