Budget 2020 Malaysia
It’s that time of the year again where our Finance Minister will announce the new Budget 2020 Malaysia.
The new Budget 2020 Malaysia will be announced on 11th October 2019, Friday.
It’s going to be the second time the new Pakatan Harapan government table their Budget.
Budget 2019 theme is Credible Malaysia, Dynamic Economic, Prosperous Rakyat.
I do hope they will maintain the “Prosperous Rakyat” part in Budget 2020 if you know what we mean. (chuckles)
So, what do you expect from Budget 2020 Malaysia?
Ahh… I hear you.
You want Bantuan Sara Rumah ( BSH ) to stay.
A big topic about BSH: but, if help out the lower-income people. Yeah, why not.
You want the Public Transportation Monthly passes to stay.
I think this is an excellent move because I know my sister and many that use Public Transport to work will benefit from this.
You want the government to do something about our economy, our precious Ringgit, and, most importantly, to encourage investors back to Malaysia.
Honestly, we need more enthusiastic employers and companies to have faith in our country.
The big companies will create more job opportunities for us, Malaysian, especially for our young graduates or anyone that want to work.
Real Property Gain Tax ( RPGT)
Real Property Gain Tax ( RPGT) is changing every single year. Typically, the changes happen during the announcement of Budget Malaysia.
During Budget 2019. The Real Property Gain Tax ( RPGT) can be, how to say it, oh! The word I’m looking for is HARSH.
Real Property Gain Tax ( RPGT) was 30% from the first to the third year. Follow by 4th year 20%, 5th year 15% and after that 5%.
I do understand if the government wants to control the five years of the Real Property Gain Tax ( RPGT) rate. But, they go overboard with after the six years onwards.
Come on! We need to pay Real Property Gain Tax ( RPGT) even after five years!
I hope they will make an amend on the six-year onwards. It’s too harsh, I think.
During Budget 2019 Malaysia, first-time house buyer stamp duty is a big thing being table.
To refresh your mind. In budget 2019, the stamp duty exemption for first-time house buyers is as follows.
Stamp Duty Exemption 2019 For Subsale or Under Construction Property
Must be a first-time house buyer.
You never own or inherited a house.
A completed house with a residential land title. Subsale house.
You are buying a completed house from a Property Agent, Seller, and developer.
Or you are buying an under-construction house from a developer.
The house must not fall under a small office home office (SOHO), small office flexible office (SOFO), small office virtual office (SOVO) dan service apartment.
Property Price/ Value must be less than RM500,000
The maximum exemption is up to the first RM300,000 stamp duty amount.
The First Example,
If the property Purchase Price or Property value is RM300,000, the property stamp duty will be as follows.
For the first RM100,000, 1% : RM100,000 x 1% = RM1000
From RM100,001 to RM200,000, 2% = RM200,000 x 2% = RM4,000
Total Stamp duty is RM5000.
Total Stamp Duty exemption for a first-time homebuyer is RM5000.
The Second Example,
If the property Purchase Price or Property value is RM400,000, the property stamp duty will be as follows.
For the first RM100,000, 1% : RM100,000 x 1% = RM1000
From RM100,001 to RM300,000, 2% = RM300,000 x 2% = RM6,000
Total Stamp Duty is RM7,000
Total Stamp Duty exemption for a first-time homebuyer is maximum RM5000.
So, you shall pay the difference RM7000-RM5000= RM2000.
Stamp Duty Exemption For Loan Agreement
Besides the above exemption, if you are applying for a home loan for the above property, the loan agreement stamp duty will be exempted too.
The loan agreement Stamp Duty is 0.50% from the loan amount.
If the loan amount is RM300,000, the stamp duty for the loan agreement is RM300,000 x 0.50% = RM1500
You don’t need a loan stamp duty calculator to calculate this. Just use your physical calculator.
The exemption applies to a maximum loan amount of RM300,000.
If the loan amount is RM400,000, the loan agreement stamp duty is RM400,000 x 0.50% = RM2000.
The maximum stamp duty exemption for the loan agreement is RM1500.
So, you shall pay the difference RM2000-1500 = RM500.
Stamp Duty Malaysia Exemption Expiry Date: 31st December 2020
Home Ownership Campaign (HOC) Stamp Duty Exemption
Home Ownership Campaign (HOC) was also announced during Budget 2019.
Home Ownership Campaign (HOC) is an excellent way for the developer to sell their unsold unit.
Under HOC, Malaysian house-buyers will be exempted from stamp duties for the purchase of residential units made between January to December 2019.
Developers will also offer attractive discounts and packages for house purchases made during the period.
HOC is open to all homebuyers to encourage property ownership and stimulate the Homeownership Campaign.
If you’re interested to know more about Home Ownership Campaign (HOC). Follow the below REDHA link.
Home Ownership Campaign (HOC) is until 31st December 2019.
The campaign was extended earlier this year.
Whether the campaign will be extended to next year or not, let’s wait and see.
Okay, so that’s a couple of things that happen on Budget 2019 Malaysia.
We hope in Budget Malaysia 2020, there will be more goodies and great news for all of us.
And hope our country on the path of prosperity so that people can live a happy life.
Online Mortgage Consultant
012-6946746 ( David)