All residential stratified properties are now categorised as “Goods and Services Tax (GST) exempt supply”, said National Home Buyers Association (HBA) secretary-general Chang Kim Loong.
Previously, only low-cost and low-medium cost properties were granted such exemption.
Being categorised as “GST exempt supply” would mean that fees charged by a management corporation (MC) or joint management body (JMB) for maintenance and management, including a sinking fund, will be exempted from GST.
Chang said a petition was sent to the Finance Ministry on Nov 28 last year, appealing to the government to amend the GST Act 2014 to enable a GST zero-rated tax supply for maintenance charges, sinking fund and all forms of related contributions or charges payable by property owners.
The petition was undersigned by HBA; the Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector Malaysia; Royal Institution of Surveyors Malaysia; and Malaysian Institute of Professional Property Managers, representing six million property owners and occupiers of approximately 15,000 stratified development areas in Peninsular Malaysia.
“From the reply we received from the tax division secretary of the ministry, Datuk Siti Halimah Ismail on Jan 15, it was stated that the appeal for GST zero-rated tax supply cannot be considered for the services rendered by MCs and JMBs to residential parcel owners of stratified properties because the supplies provided by them are deemed as conducting a form of business.”
“However, the ministry is agreeable to widen its GST exempt supply by including all categories of residential stratified properties,” he told a press conference yesterday.
Chang added that amendments will now be made to Paragraph 20, Second Schedule, of the Goods and Services Tax (Exempt Supply) Order 2014.
He pointed out that any fees charged to stratified buildings or parcels that is used for purposes other than residential will still be subjected to GST standard rated tax.
Source: TheSunDaily
