The Finance Minister, YAB Lim Guan Eng, has announced that the disposal of properties at a consideration price of RM200,000 and below will be exempted from the real property gains tax (RPGT) effective 1st January 2019.
The Star reported that for the acquisition of assets before year 2000, the market price on Jan 1, 2000, would be used as the acquisition price for the disposal of property by Malaysian citizens and permanent residents.
Initially, the government agreed to increase the RPGT rate on gains from disposal of properties and shares in property holding companies in the 6th year and beyond beginning January 2019. The RPGT rate hike is 5%.
However, the rakyat’s welfare and the burden that would be imposed on them with the imposition of RPGT became a huge concern, hence the government agreed to give this RPGT waiver.
On top of that, the government would also waive service tax for persons registered for Service Tax in Group G (Professional Group) who provide the same service to registered persons. For example, an advocate and solicitor who provides legal services to other advocates and solicitors.
The same service tax exemption will also apply to taxable services that are imported by any company in Malaysia from foreign companies that are companies within the same group but restricted to certain types of services in Group G.
This too, is effective 1st January 2019.
Existing exemptions on RPGT include the disposal of a personal residence (once-in-a-lifetime disposal), RM10,000 or 10% of chargeable gain, transfer of ownership as a gift, and allowable losses. Read this for more info on RPGT in Malaysia 2019.