IF Singapore starts taxing all gains from selling properties or reintroduces an inheritance tax, demand for mass-market condominiums is expected to be dampened the most, a survey found.
A dip in foreign buying activity is also likely, although only a minority of Singaporean investors may decide to focus more on overseas markets, real estate executives said in a poll by the National University of Singapore Real Estate (NUS+RE).
Norman Ho, senior partner in corporate real estate at Rajah & Tann, told The Business Times (BT) that the added effect of a capital gains tax, on top of existing stamp duties, will “definitely discourage wealthy owners from buying even more property”.
Speaking in his private capacity in July, Monetary Authority of Singapore managing director Ravi Menon floated the idea of a property gains tax or an inheritance tax to address inequality, and noted that the widening wealth gap across the world has historically been driven most strongly by property investments.
But Prime Minister Lee Hsien Loong has said that efforts to ease inequalities through wealth taxes face challenges such as ensuring fairness, and pose risks to the country’s competitiveness.
