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.
Move criticised by some Hong Kong lawmakers will add new revenue at a time of record deficits, be a direct tax on the rich, and may also help lower market volatility.
Few people disputed the need to cool the bubbly property market last year. But the way the government goes about it has been less than rational.
Nearly 10,000 potential buyers have registered an interest in the 171 flats available in the second batch of Phase 2B at the Novo Land project in the New Territories, according to SHKP, which means about 58 people will compete for each unit.
Hong Kong developer Wheelock Properties sold 110 units out of the 148 on offer as of 10pm at its Koko Rosso project on Friday.
Buyers want to get ahead of an expected boom in the housing market following the announcement of the ad valorem measure, say agents.
Financial secretary sets sights on higher taxes for smokers, while Hong Kong Jockey Club will pay an increased betting duty.
Hong Kong property prices are tipped to fall further in 2023 even as the economy improves, according to CPA Australia, which also said it is time for the Hong Kong government to reconsider its property sector cooling policies.
China’s proposed move to lower stamp duty has been misinterpreted by some investors that it could lead to a cut in trading costs, despite there being no such mention, analysts said.
The government must have its objectives and basic principles clearly in mind when launching any initiative and communicate them effectively to the public.
Higher stamp duty will bring in additional revenue and help to drive away speculative activities by high-frequency traders, but it also possible turnover could fall sharply.
Hongkongers hoping to buy UK residential property are facing a double headache on investment costs in the coming days as a new surcharge looms on foreign buyers, while sustained demand has pushed house prices to new highs.
Homebuyers could face higher transaction costs globally as governments raised wealth taxes or mulled new ones to refill state coffers after spending almost US$20 trillion in stimulus to keep economies afloat during the pandemic.
Hui’s comment underscores how investors have mostly shrugged aside the knee-jerk reaction after the government’s first increase in stock trading stamp duty in nearly three decades.
The increase in stamp duty means traders will pay HK$300 (US$38.7) more for every HK$1 million in transactions.
Relief measures and stamp duty welcomed by industry leaders, and while politicians applaud HK$5,000 spending voucher, some say it was not enough to alleviate concerns over unemployed.
Persistent issues, such as rampant plastic waste, substandard wages for the impoverished and housing speculation, continue to go unaddressed by the administration. These must be tackled to show that the government cares.
Hong Kong shop owners are more likely to stand firm on asking prices, as they expect investors to flood the market after the city scrapped the double stamp duty for non-residential property, investors and property agents said.
In abolishing the double stamp duty, the government is trying to breathe life into a market where transactions never surpassed 10,000 in any year since.
The expectation is that a developer, or group of developers, will buy the site as a whole, tear old structures down, and then redevelop it into new luxury apartments.
The pairing of low income tax and high property values has been successful for the city, but experts warn it might not last.
Housing minister Frank Chan reveals figure, but says there is no plan to drop tax while property prices remain high.
Local property developers, mainland Chinese and firms registered in Bermuda or the British Virgin Islands are taking advantage of the system, study finds
Tax revenue swelled to a record high of HK$328.6 billion in the financial year 2017-18, up 13 per cent on the previous year’s taking, thanks to an upsurge in stamp duty revenue.