Property cooling measures pay

The sitting room of a condominium in world’s tallest luxury residence in Singapore. Statistics suggest that foreign buying interest has picked up again after the market initially cooled in response to the measures. — EPA

Singapore collects US$500mil from additional stamp duties

SINGAPORE: The taxman has collected more than half a billion dollars from additional stamp duties imposed as part of property cooling measures.

The additional buyer's stamp duty (ABSD) has contributed the bulk of that US$450mil between its inception on Dec 8 last year and the end of last month.

A further US$51mil has come from the seller's stamp duty since it was implemented in February 2010, the Inland Revenue Authority of Singapore (Iras) said. According to Iras' annual report, it collected US$2.5bil in stamp duty from sale and purchase agreements in its financial year ended March 31, 2011.

The ABSD take includes about US$261mil collected from foreigners who are not permanent residents (PRs), who bought about 1,400 homes in the nine months to the end of last month, Iras told The Straits Times.

These foreigners comprised about one in four of the buyers who have paid the additional tax.

The figures seem to suggest that foreign buying interest has picked up again after the market initially cooled in response to the measures. In the first four months after the tax was introduced, foreigners paid US$66.2mil in ABSD on the purchase of 369 private homes.

Afterwards, the tax take and transactions shot up, with about US$200mil collected in the subsequent five months on more than 1,000 homes bought. Experts said this trend was also borne out on the ground.

The Urban Redevelopment Authority's Realis website shows that non-PR foreigners bought 358 homes in the first three months of the year or 5.4% of private home purchases. In the second quarter, they snapped up 637 homes 6.7% of private home sales led largely by renewed interest in city centre and city fringe homes.

These numbers are still well below the quarterly sales average of 1,369 foreign-bought units seen last year.

International Property Advisor chief executive Ku Swee Yong said that while foreign buyers held back from purchases when the additional buyer's stamp duty was first announced, continued uncertainty in the global economy had led them to reconsider Singapore. “Singapore is still a safe haven, and for high-net-worth individuals, their goal of wealth preservation might have overridden their concerns of the ABSD,” he said.

By Asia News Network/ST