Revenue Loss from Uncollected Strata Titles

Federal government not receiving timely stamp duty revenue

As a result of property owners not collecting their strata titles, which involve stamp duty payments and registration fees, the government is not receiving revenue, which may run into millions of ringgits, in a timely manner.  Real Estate and Housing Developers Association says this is an old issue. While the government will not lose this revenue, it is a question of when.

The property owners have to pay stamp duty to the Inland Revenue Department according to a scale. For the first RM100,000 it is 1% or RM1,000 per parcel. If the property is more than RM1mil, it is 4% or RM40,000. Which mean the government is deprived of the stamp duty revenue.
Article of Stamp Duty can refer here.

The state land office also misses out on the revenue in a timely manner. In Selangor, the registration fees an owner has to pay to procure the title rangers between RM50 and RM1,500. This amount varies state to state.

The strata title is a very important document. In the event that it falls into dishonest hands, another person can apply for a loan using that document, or lay claim to the property.
Article of Strata Title can refer here.

The National House Buyers Association honorary secretary-general Datuk Chang Kim Loong says property owner short-changing themselves besides depriving the government of an important source of revenue.

Chang says: “Should the developer goes under liquidation or becomes insolvent; the unit owners will have to go through a lot of trouble. A third party, in this case the liquidator, may impose administrative charges if between 2% and 3% as their ‘consent/ verification’ fees.”         




Source: Thestar @ Biz Property