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17-03-14, 14:21
http://www.straitstimes.com/archive/tuesday/premium/money/story/record-high-collection-stamp-duties-20140311
Record high collection in stamp duties
Increase partly due to higher amount in additional buyer's stamp duty netted last year despite home loan restrictions
Published on Mar 11, 2014
By Melissa Tan
A RECORD amount in stamp duty poured into the nation's coffers last year.
This was achieved even though new home loan restrictions introduced in June put a damper on the taxman's collection of additional buyer's stamp duty (ABSD) on property purchases.
Total stamp duty assessed from January to December last year totalled $4.5 billion, the Inland Revenue Authority of Singapore (Iras) told The Straits Times.
This was higher than the $4.3 billion in total stamp duty assessed from January to December 2012, according to Department of Statistics data.
The increase is partly due to a higher amount of ABSD netted last year. Home buyers incur up to 15 per cent in ABSD on their purchases depending on their citizenship and the number of homes they have already bought.
The total ABSD assessed in the first six months of the year was $829.6 million, Iras said. This was higher than the $762.2 million in ABSD the taxman netted from January to December 2012.
ABSD was introduced in December 2011, and the sum collected that month was $3.1 million.
But ABSD assessed fell in the second half of last year in tandem with private home sales, though not as sharply. It dropped to $703.9 million for July till December, around 15 per cent lower than that in the first half.
This was after the Government capped borrowers' monthly debt repayments at 60 per cent of gross monthly income under a total debt servicing ratio (TDSR) system that took effect on June 29.
Still, private home sales fell more steeply from the first half to the second, which analysts said may have been caused by TDSR effectively slashing buyer demand at the lower end of the private home market. The volume of new private home sales halved from 10,182 units in the first half to 5,118 units in the second half, according to Urban Redevelopment Authority (URA) data. This figure excludes executive condominiums (ECs), a public-private housing hybrid. The resale of private homes excluding ECs tumbled from 4,078 units in the first half to 2,530 units in the second. Subsales, which are resales before completion, also fell from 727 units in the first half to 345 units in the second, URA figures show.
Analysts said the percentage drop in ABSD collected was milder than that of private home sales probably because TDSR had a smaller impact on buyers with deeper pockets. "TDSR mostly affects the middle class, such as those who want to buy a second private property while already holding one. The wealthy may not need to get loans," said Chris International director Chris Koh.
Real estate lawyer Lee Liat Yeang said the type of launches that sold well in each half-year also likely played a part. For instance, higher-end projects such as Duo Residences in Bugis and Alex Residences in Redhill were popular in the second half of last year. They likely drew more investors, who are more likely to incur ABSD, than HDB upgraders, he noted. In contrast, popular projects in the first half were mostly in suburban areas, like the J Gateway project in Jurong East.
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Record high collection in stamp duties
Increase partly due to higher amount in additional buyer's stamp duty netted last year despite home loan restrictions
Published on Mar 11, 2014
By Melissa Tan
A RECORD amount in stamp duty poured into the nation's coffers last year.
This was achieved even though new home loan restrictions introduced in June put a damper on the taxman's collection of additional buyer's stamp duty (ABSD) on property purchases.
Total stamp duty assessed from January to December last year totalled $4.5 billion, the Inland Revenue Authority of Singapore (Iras) told The Straits Times.
This was higher than the $4.3 billion in total stamp duty assessed from January to December 2012, according to Department of Statistics data.
The increase is partly due to a higher amount of ABSD netted last year. Home buyers incur up to 15 per cent in ABSD on their purchases depending on their citizenship and the number of homes they have already bought.
The total ABSD assessed in the first six months of the year was $829.6 million, Iras said. This was higher than the $762.2 million in ABSD the taxman netted from January to December 2012.
ABSD was introduced in December 2011, and the sum collected that month was $3.1 million.
But ABSD assessed fell in the second half of last year in tandem with private home sales, though not as sharply. It dropped to $703.9 million for July till December, around 15 per cent lower than that in the first half.
This was after the Government capped borrowers' monthly debt repayments at 60 per cent of gross monthly income under a total debt servicing ratio (TDSR) system that took effect on June 29.
Still, private home sales fell more steeply from the first half to the second, which analysts said may have been caused by TDSR effectively slashing buyer demand at the lower end of the private home market. The volume of new private home sales halved from 10,182 units in the first half to 5,118 units in the second half, according to Urban Redevelopment Authority (URA) data. This figure excludes executive condominiums (ECs), a public-private housing hybrid. The resale of private homes excluding ECs tumbled from 4,078 units in the first half to 2,530 units in the second. Subsales, which are resales before completion, also fell from 727 units in the first half to 345 units in the second, URA figures show.
Analysts said the percentage drop in ABSD collected was milder than that of private home sales probably because TDSR had a smaller impact on buyers with deeper pockets. "TDSR mostly affects the middle class, such as those who want to buy a second private property while already holding one. The wealthy may not need to get loans," said Chris International director Chris Koh.
Real estate lawyer Lee Liat Yeang said the type of launches that sold well in each half-year also likely played a part. For instance, higher-end projects such as Duo Residences in Bugis and Alex Residences in Redhill were popular in the second half of last year. They likely drew more investors, who are more likely to incur ABSD, than HDB upgraders, he noted. In contrast, popular projects in the first half were mostly in suburban areas, like the J Gateway project in Jurong East.
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