We’re halfway into the RMCO (Recovery Movement Control Order), and fingers crossed it won’t revert to the MCO phase again. Meanwhile, the government has come up with several economic packages since March to maintain and restore the economy, amid the Covid-19 fears and increasing unemployment rates. A quick recap of the stimulus packages so far:
- February 2020 – RM20 billion – 2020 Economic Stimulus Package
- March 2020 – RM230 billion – PRIHATIN
- April 2020 – RM10 billion – Extended Prihatin for SMEs
- June 2020 – RM35 billio – PENJANA
The government’s measures under PENJANA aim to save jobs and promote employment, while ensuring the people have enough to continue their daily lives. In contrast with the PRIHATIN package which was announced in March, PENJANA is a smaller, targeted approach to reflect new realities of our economic mix. Some of the measures issued in PENJANA include new tax incentives, boost for specific economic sectors, financial assistance for small and medium-sized businesses (SMEs), and job protection initiatives.
The aim of introducing these incentives for the property sector in Malaysia is to stimulate the property market and provide financial relief to home buyers and property owners.
WHO
Homeowners, prospective homebuyers
HOW MUCH
RM1 billion
WHEN
From June 2020
WHAT
Home Ownership Campaign (HOC)
The reintroduction of HOC will attract more first-time buyers and investors, as well as buyers looking to upgrade their current residence. The HOC offers stamp duty exemption on the first RM1 million of a property’s value on the Memorandum of Transfer (MoT) for properties priced from RM300,000 to RM2.5 million, and 100% stamp duty exemption for the financing agreement. The exemption is applicable between June 1, 2020, to May 31, 2021, subject to properties that are priced at a 10% discount provided by developers.
Real Property Gains Tax (RPGT) exemption
RPGT will be waived for the disposal of residential homes from 1st June 2020 to 31st December 2021. This measure is meant to help the owners who need to liquidate their property(s) due to financial woes. This means that any gains arising from the disposal of residential property within this period will be exempt from real property gains tax. This exemption is limited to three residential properties per individual. However, there has been confusion among those intending to sell their property as the new rates have yet to be gazetted.
Lifted financing margin
The current 70% margin of financing limit (housing loan) for a third residential property onwards valued at RM600,000 and above, will be uplifted during the period of the HOC. However, the government has not stated by how much.
[Extended] Rental tax deduction
In the previous stimulus packages, landlords were eligible to tax deductions equivalent to the 30% reduction in rental from April to June 2020. This has now been extended to September 2020 under the PENJANA package. This incentive is eligible for landlords that rent their premises to SME tenants and the premises must be used for their business operations.
The full PENJANA booklet (in English) can be viewed here.
