The National House Buyers Association (HBA) has voiced strong opposition to the proposed reintroduction of an inheritance tax in Malaysia’s 2025 Budget. The tax is one of several measures being considered to broaden the country’s tax base and increase government revenue. However, HBA secretary-general Datuk Chang Kim Loong argues that such a tax penalises years of hard work and amounts to double taxation on assets that have already been taxed during the owner’s lifetime.

The inheritance tax, which was abolished in 1991, has resurfaced as a potential fiscal tool, alongside other proposed taxes such as those on unhealthy foods, carbon pricing, high-value goods, and artificial intelligence (AI). While the unhealthy food tax aims to curb obesity, and the carbon pricing tax aligns with environmental goals, the inheritance tax is intended to prevent the concentration of wealth within families, thereby reducing economic inequality.

Despite these objectives, Chang expressed his concerns about the inheritance tax’s unintended consequences, particularly on middle-class families and small business owners. He stated that the tax would disproportionately affect those who have worked hard to acquire assets, particularly property, and who intend to pass these assets on to future generations.

“The inheritance tax is effectively imposing a tax on inflation,” Chang explained. “If a taxpayer has worked hard, paid taxes, and invested in assets such as property, commodities, and equities, it is utterly unfair for these assets to be taxed again upon their death. It is everyone’s aspiration to improve their economic condition and provide a better start in life for their children.”

Chang also highlighted the fact that property often represents the largest portion of a family’s wealth. For many Malaysians, their homes are not just investments but legacies intended for future generations. By taxing inherited property, the government would, in his view, be unfairly targeting individuals who have used property as a hedge against inflation.

To illustrate his point, Chang cited the example of a property purchased in 1977 for RM20,000, which increased in value to RM380,000 by 2020. While this may seem like a significant gain, he pointed out that much of the increase is due to inflation over the 43-year period. Adjusting for an estimated inflation rate of 5.5%, he calculated that around 55.5% of the property’s increased value could be attributed to inflation.

“If an inheritance tax is introduced, it would be based on the property’s current market value, meaning that beneficiaries would essentially be paying a tax on the inflation that occurred during the property’s ownership,” Chang said. He further noted that in cases where the beneficiary could not afford the tax, the government could potentially seize the property, putting the beneficiary in a precarious financial situation.

Chang also warned that the reintroduction of an inheritance tax could discourage wealth generation and lead to capital flight. He argued that such a tax could undermine efforts to encourage economic growth and success, driving successful individuals to relocate their wealth and investments to more tax-friendly countries.

A proposed review of the National Housing Policy will make home ownership more affordable while increasing disposable income, says Datuk Seri Dr Ahmad Zahid Hamidi.

The Deputy Prime Minister said the review may be necessary because of the increase in household debt to gross domestic product (GDP) ratio from 67.2% in 2002 to 81.2% in 2022.

“The property sector continues to dominate household debt, with housing credit increasing from 36% in 1997 to 59.7% in 2022,” he said in a statement after chairing the third National Action Council on Cost of Living (Naccol) 2024 meeting on Thursday (Oct 10).

“This trend is seen as having a significant impact on disposable income levels, and the meeting agreed to examine the matter further, particularly in the context of credit growth amid wage stagnation, especially for the lower 70% of households.”

Also present were Domestic Trade and Cost of Living Minister Datuk Armizan Mohd Ali, state government representatives, corporate figures, NGOs, industry players and consumers.

Ahmad Zahid said the Finance Ministry should take up the policy review proposal with Bank Negara and the Housing and Local Government Ministry.

“This includes reviewing the provision of long-term housing loans to ensure that individuals and less capable households can own homes without being burdened by rising prices, particularly long-term housing loan financing,” he said.

The Statistics Department also presented the Cost of Living Indicator 2023, developed to provide an overview of the total expenditure required by households to meet a decent standard of living.

The meeting was also informed that this indicator will be launched by the Prime Minister on Nov 2, Ahmad Zahid said.

“This new indicator is expected to add value to government policy-making related to the cost of living, including implementing aid distribution, especially to targeted groups.”

The meeting also discussed co-payment features for medical and health insurance and takaful (MHIT) products, presented by Bank Negara.

It was informed that the co-payment system provides consumers with more choices, and encourages healthy competition among insurance or takaful providers to match the financial situation of consumers.

“According to Bank Negara, co-payment can offer prices between 19% and 68% lower than products without co-payment, indicating a good balance between supply and demand in the country’s medical and health sector.

“We discussed the implementation of two co-payment features to help create a conducive and sustainable health ecosystem through transparency in medical bills,” Ahmad Zahid added.

Source: TheStar.com.my

Penang’s Light Rail Transport (LRT) dream will begin to take shape in December with a groundbreaking event, with the first station to be built in Lebuh Macallum.

Transport Minister Anthony Loke is said to have approved a date to get the 29km Mutiara Line landmark project off the ground.

The alignment starts from Penang Sentral on the mainland before crossing the channel to Lebuh Macallum.

From there, the multibillion-ringgit line will pass through Komtar, Bandar Sri Pinang, Sungai Pinang, East Jelutong, The Light, Gelugor, Jalan Universiti, Sungai Dua, Sungai Nibong, Bukit Jambul, SPICE, Jalan Tengah, the Free Industrial Zone, Free Industrial Zone South, Sungai Tiram, the Penang International Airport, Permatang Damar Laut and Silicon Island, which will serve as a depot.

A component of the Penang Transport Master Plan, the Penang LRT will have 20 stations, including two interchange stations at Komtar and Penang Sentral in Butterworth, with completion slated for 2030.

It was reported recently that project developer Mass Rapid Transit Corp Sdn Bhd (MRT Corp) might opt for a rubber-tyred metro system to save on operations and maintenance costs.

With annual ridership projected at between five million and 42 million passengers, the Penang government is counting on the mammoth project to ease chronic traffic congestion in the state.

The Gamuda-led group SRS Consortium is currently finalising terms and conditions for the civil works package, which will cost about RM7.6bil.

Gamuda is planning to bid for the electrification and signalling works, worth about RM1.2bil.

The project has three main components: civil construction works for Segment 1, covering the alignment of Silicon Island to Komtar; Segment 2, which covers the line from Komtar to Penang Sentral, and a turnkey contract for system and carriage (coach) works.

Small and Medium Enterprises Association honorary national secretary Yeoh Seng Hooi said the LRT project would also provide more jobs, with skilled locals to benefit.

“The spillover effects will benefit subcontractors and those providing goods and services for the project.

“Infrastructure development, which reduces transport costs and travel time, will boost foreign and domestic investments,” he said.Transport analyst Abi Sofian Abdul Hamid said incorporating support networks like shuttle services and parking facilities would ensure the LRT system’s efficacy.

He said transit-oriented “last-mile” development around LRT stations would contribute to green transportation and lower carbon emissions.

In June, Loke said he hoped that physical work could commence before the year’s end.

He also revealed that the LRT’s alignment had been finalised.

He said this was done after discussions with all parties and that the Penang government agreed with the alignment proposed by MRT Corp, with the passenger station starting from Bayan Lepas to Komtar and one line to Penang Sentral.

On March 29, Loke announced that the Federal Government had taken over the Penang LRT project from the state government, with MRT Corp appointed as developer and asset owner.

Source: TheStar.com.my

Dato’ Goh Teng Whoo, COO of Ideal Property Group

Real estate developer Ideal Property Group has launched the next phase of its industrial project “Ideal Business Hub“, which has a gross development value (GDV) of RM260mil, in Bertam Penang.

Ideal Business Hub is an exciting new light industrial park situated in the North Seberang Perai District (SPU). This 28-acres freehold development offers a total of 88 bungalows, semi-detached and cluster-type factories.

Ideal Property Group Chief Operating Officer Dato’ Goh Teng Whoo said Ideal Business Hub is located within the parcel 2 development of the 880-acres Penang Technology Park @ Bertam, aims to create a complete business ecosystem, and provides an opportunity for businesses to access their supply chain network conveniently.

The column free design factories feature a spacious layout with a 9.15m high ceiling, thus allowing for all types of storage racks, and able to accommodate large machineries for the majority of light industry usage/demand. Full length glass windows across the modern facade, offers the interior never ending natural lights.

“Each unit comes with 200 to 300 AMP power supply, with the floor capacity of 1.5 ton/m2 and a dedicated loading bay. All aspects aim to enhance productivity and maximize efficiency for all type of businesses.”

Dato continues, being part of Penang Technology Park @ Bertam brings more opportunities to collaborate with top industry leaders and at the same time fuel the business growth.

“What differentiates us from other business parks is that we provide a one-stop industrial solution for business owners, including dealing with authorities and various licensing agencies, department of Environment assessments, and applications for government incentive programs.”

Ideal Business Hub is located within the vibrant and bustling heart of Bertam, Penang, surrounded by the vibrancy and amenities of a matured and growing township.

It is situated just 23 kilometres from the Penang Port in Butterworth and a mere 42km from the Penang International Airport.

The 88 units offer an innovative flexi-space concept that caters to manufacturers specializing in warehousing, packaging, processing, logistics and light production.

“Ideal Business Hub’s unique design and layout emerged from extensive discussions and engagements with industrial operators and end users,” said Dato.

Construction of Ideal Business Hub will begin in November this year and is targeted to be completed in 2026.

Penang Technology Park @ Bertam’s first phase, is now approximately 50% taken up by local and foreign companies in various sectors, including semiconductor, lithium battery and automobile electronic manufacturing, electronics assembly, medical devices, trading, warehouse, and logistics.

Malaysia’s property sector saw over RM100 billion in sales in the first half of 2024, exceeding the government’s full-year target. Housing and Local Government Development Minister Nga Kor Ming announced that the National Property Information Centre (NAPIC) recorded RM100.5 billion in sales from January to June. If the trend continues, the government expects to reach RM200 billion by the end of the year.

Nga emphasized the importance of the property sector to the economy, noting its impact on more than 200 related industries such as construction, renovations, furniture, and banking. The thriving property market helps boost these sectors, supporting jobs and economic activity across Malaysia.

To ensure sustainable growth, the ministry is developing a big data system to track property needs across the country. This tool will help developers understand where housing projects are most needed and what types of homes and price ranges are in demand. The system aims to prevent the construction of unsellable or misaligned projects.

Additionally, the government is considering mandatory courses for new owners of public housing to educate them on responsibilities like paying maintenance fees. This aligns with the government’s rebranding of the People’s Housing Projects (PPR) to the People’s Residency Programme, which aims to improve public housing management.

Nga spoke at a press conference following a key handover ceremony for 20 homeowners at Ideal Residency in Penang. He praised Penang for its quality affordable housing and highlighted the state’s status as a leading exporter of electrical and electronic goods in the region.

Also present at the event were state housing committee chairman Datuk Seri S. Sundarajoo, PR1MA CEO Datuk Seri Mohd Nazri Md Shariff, Ideal Property Group chairman Tan Sri Alex Ooi Kee Liang, and Seri Delima assemblyman Connie Tan.