In Penang, roadshows in malls to explain 2020 assessment rate review

GEORGE TOWN, Sept 26 — The Penang Island City Council (MBPP) will be conducting roadshows at shopping malls to explain the review of its assessment rates for 2020.

MBPP Mayor Datuk Yew Tung Seang said they will be announcing the dates and locations of the roadshow through its social media pages and through the media within the next few days.

“We will go down to the ground to explain in detail how we calculate the annual value and how ratepayers can submit their appeals against the new rates,” he said in a press conference after chairing the full council meeting at City Hall this morning.

He said MBPP will set up booths at major shopping malls to reach out to more ratepayers.

Yew said the assessment rates for 16 out of 17 types of properties on the island were reduced next year compared to current rates.

For example, the original rate for stratified low cost and low medium cost properties is 7.5 per cent currently but it was readjusted to five per cent for 2020.

The rates for apartments and condominiums were also reduced from 8.5 per cent to 5.8 per cent.

There were no changes in the rates for associations and clans which remained at seven per cent.

“We are aware of the review in annual value of properties meant an increase in value for most properties so we reduced the assessment rates to lessen the impact,” he said.

He said the review exercise only affected the annual value of properties which saw an increase in most cases.

The annual value of properties has been in use since January 2005 and have not been reviewed for 15 years.

“We were not able to review it in the past 15 years due to some circumstances but now we have to review it, otherwise the value will continue to increase and it will lead to an even higher increase in future if we don’t review it now,” he said.

The annual value of properties is calculated based on the rental value of the properties derived from the Income Revenue Board, Valuation and Property Services Department (JPPH) and other relevant agencies.

Yew used the annual value of a residential terrace house as an example.

“The current annual value is RM3,900 which means the property’s rental value is RM325 each month back in 2005 and after the review, the annual value is RM9,070 which translate to RM756 rental value each month,” he said.

Previously, with the annual value of RM3,900, the assessment rate was 9.3 per cent so the property owner had to pay RM362.70 in assessment rates per year.

The revised annual value of RM9,070 for 2020 and a reduced assessment rate from 9.3 per cent to six per cent meant the owner has to pay RM544.20 in assessment rates per year.

Yew said the same formula was used for all properties on the island.

Both city councils in the state, including the Seberang Perai City Council (MBSP), reviewed the assessment rates for 2020.

All ratepayers have the avenue to submit their objections and appeals against the review to both MBPP and MBSP, either online or through the respective offices.

Yew said all appeals by ratepayers will be taken into consideration before the city council implement the reviewed rates and property annual value.

Both city councils have been under fire recently due to the assessment rates review with most ratepayers claiming they saw an increase of between 50 and 98 per cent.

Yew admitted that most property owners will find an increase in the rates they had to pay as the annual value of their properties has increased over the past 15 years.

“Even the rates for my house, a double-storey house, have increased by 78 per cent from about RM300 to about RM600,” he said.

He hoped the roadshows will help ratepayers understand the reasons behind the increase in total rates paid and how the city council had tried to mitigate the impact by reducing the percentage of assessment rates.