Property cooling steps net $500m for taxman

Property cooling steps net $500m for taxman

The taxman has collected more than half a billion dollars from additional stamp duties imposed as part of property cooling measures.
The additional buyer's stamp duty (ABSD) has contributed the bulk of that - $450million between its inception on Dec8 last year and the end of last month.

A further $51million has come from the seller's stamp duty since it was implemented in February 2010, the Inland Revenue Authority of Singapore (Iras) said.

According to Iras' annual report, it collected $2.5 billion in stamp duty from sale and purchase agreements in its financial year ended March 31, 2011.

The ABSD take includes about $261million collected from foreigners who are not permanent residents (PRs), who bought about 1,400 homes in the nine months to the end of last month, Iras told The Straits Times. These foreigners comprised about one in four of the buyers who have paid the additional tax.
The figures seem to suggest that foreign buying interest has picked up again after the market initially cooled in response to the measures. In the first four months after the tax was introduced, foreigners paid $66.2million in ABSD on the purchase of 369 private homes.

Afterwards, the tax take - and transactions - shot up, with about $200million collected in the subsequent five months on more than 1,000 homes bought.

Experts said this trend is also borne out on the ground.

The Urban Redevelopment Authority's Realis website shows that non-PR foreigners bought 358 homes in the first three months of the year - or 5.4per cent of private home purchases. In the second quarter, they snapped up 637 homes - 6.7per cent of private home sales - led largely by renewed interest in city centre and city fringe homes.

These numbers are still well below the quarterly sales average of 1,369 foreign-bought units seen last year.
The tough cooling measures last December slapped a 10 per cent ABSD on all home purchases by foreigners. PRs had to fork out only an extra 3per cent on their second and subsequent home purchases, while Singaporeans had to do so only for their third home onwards.

Source: The Straits Times – 24 September 2012