Singapore property tax hike to hit expat buyers

Published:  17 Jan at 6 PM
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In a bid to cool Singapore’s rapidly-overheating property market, the city state’s government is introducing higher property taxes in the form of increased stamp duty.

Companies and foreigners purchasing residential property in Singapore will be hit by an extra buyers’ stamp duty of 15 per cent of the purchase price, an increase from the present 10 per cent. Singaporean citizens purchasing second homes will also be affected, with the new rate set at seven per cent, and expats with permanent residency status will be charged five per cent of the purchase price.

According to Minister of Finance and Deputy PM Tharman Shanmugaratnam, the measures are necessary to check recent market trends and avoid a disastrous reversal. Singapore’s popularity as a destination for wealthy expats combined with the country’s exceptionally low interest rates of around one per cent on mortgage loans are the main reasons for last year’s surge in the already high real estate prices.

Another reason being put forward is that the ongoing Eurozone crisis has meant more property investment in Singapore by high-net worth individuals eager to draw their funds away from the danger of a Euro collapse. Real estate professionals in the region expect 2013 increases to be between 10 per cent and 15 per cent desptire the stamp duty increases, as land prices are also soaring.
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