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Last Update: 17 Oct 2014
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Ministry of Housing Sarawak
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Taman Sukma, Jalan Sultan Tengah,
93050 Petra Jaya,
Kuching Sarawak.

Telephone :  082-445839 , 447289,
441324, 441320
Fax: 082-443148, 444525


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17 Oct 2014Understand GST, potential house buyers urged — Karim

KUCHING: The public should understand how the Goods and Services Tax (GST) works before making a decision to buy houses before April 1 next year or after its implementation.

This advice came from Assistant Housing Minister Datuk Abdul Karim Rahman Hamzah, who urged house buyers to exercise caution and not to panic as that might cause property prices to increase.

The Asajaya assemblyman also urged housing developers to play their part by not taking advantage of the situation but try to mitigate the impact.

“Take the case of the Australian situation when GST was introduced in the year 2000. People rushed to buy properties and developers rushed to complete their projects as they expected prices to increase post GST.

“As a result of this sudden increase in demand, developers ended up paying higher prices for materials and services and this was passed on to purchasers in the form of higher property prices.”

“However six to nine months after GST, prices of properties dropped due to soft property market,” he said yesterday.

First of all, he added, it should be understood that residential properties are exempted from GST even though the inputs, materials and services for their construction are subject to six per cent GST.

He also said the public should know that land for housing and financing cost are tax exempted.

With the implementation of GST, building materials such as tiles, sanitary ware and fittings would be taxed at the lower rate of six per cent compared to the 10 per cent sales tax currently, he pointed out.

The Ministry of Housing noted with concern that with the impending implementation of GST on April 1 next year, certain parties in the local housing sector had speculated that house prices would increase, urging the public to buy houses now before its implementation.

“In this respect, the Ministry of Housing is advising all potential house buyers to exercise caution in making decision to buy houses in light of such statements (speculations). This is because while the impact of GST on house prices is still uncertain, the sudden increase in demand for houses prior to implementation of GST may also cause house prices to rise further,” said Abdul Karim.


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