KUALA LUMPUR, Aug 13 — The sales tax exemption for construction materials is not a guarantee of more affordable property, said the Malaysian Institute of Architects (PAM)
PAM president Ezumi Harzani Ismail said raw materials only accounted for less than a third of the total development cost.
“The rest of the (development) cost would consist of the cost to purchase the land and other compliance charges that come with the building the houses or units.
“SST may reduce the house prices but it may not be much,” he said at the Kuala Lumpur Architecture Festival 2018 held at the Damansara City Mall here today.
He said profiteering would also prevent prices from falling.
The Finance Ministry announced yesterday that building materials will be exempted from the Sales and Service Tax (SST)
Building materials previously came under the list of taxable items under the discontinued goods and services tax.
Ezumi added that there are other factors that could raise housing prices, listing as example the high cost of building infrastructures in development projects.
“Some projects require the developers to construct basic infrastructure and facilities that are supposed to be built by utility companies.
“The added cost would then be translated back the consumers. It would be better if the authorities come up with a building master plan that could address these issues,” he said.
