Higher Rebates for Property Tax for Owner-occupied HDB Flats to Offset Increase in Property Taxes
Ministry of FinanceSpeakers
Summary
This question concerns Ms Joan Pereira’s inquiry on providing higher property tax rebates for owner-occupied HDB flats to further offset tax increases resulting from rising annual values. Deputy Prime Minister and Minister for Finance Lawrence Wong stated that a one-off 60% rebate capped at $60 was sized according to fiscal considerations and to support households in flats with lower annual values. He noted that 1- and 2-room owner-occupiers remain exempt from property tax, while 3-room and 5-room flat owners will pay between $21 and $225 annually after the rebate. The Minister highlighted that the property tax regime is designed to be progressive, with higher rates applied to properties with higher annual values and non-owner-occupied units. This system ensures that while everyone contributes, those with greater means contribute more through a fair taxation framework.
Transcript
5 Ms Joan Pereira asked the Deputy Prime Minister and Minister for Finance whether the Ministry will consider providing higher rebates for property tax for owner-occupied HDB flats in addition to the one-off property tax rebate of up to $60 to offset the increase in property taxes.
Mr Lawrence Wong: Property Tax (PT) is assessed annually based on the annual value (AV) of the property, which is based on the prevailing rental market conditions. The AVs for Housing and Development Board (HDB) properties have largely remained unchanged for the last five years. But they have moved up recently and that is why the PT payable will have to increase in 2023. But all 1- and 2-room HDB owner-occupiers will continue to pay no property tax because their revised AVs remain below $8,000.
To further cushion the impact, the Government is providing a one-off 60% PT rebate to all owner-occupied residential properties, capped at $60. We have sized the rebate based on our overall fiscal considerations, and also to provide more support for households living in HDB flats with lower AVs. For example, the PT payable for owner-occupied 3-room HDB flats will range from $21 to $40 per annum after rebate. In comparison, the PT payable for 5-room/executive HDB flats will be $148 to $225 per annum after rebate.
Our PT regime remains progressive, with higher rates applied to residential properties with higher AVs. In addition, non-owner-occupied residential properties pay higher PT. This is part of a fair system of taxation, where everyone will contribute, but those with greater means will contribute more.