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08 December 2011
SINGAPORE IMPOSES ADDITIONAL STAMP DUTY
The Singapore government has imposed an additional 10% stamp duty on foreigners and companies buying private residential property which took effect on 8th December 2011. This is in addition to the existing buyers’ stamp duty which is 1% for the first S$180,000 of the purchase price, 2% for the next S$180,000 and 3% for the next.
For Singapore permanent residents who already own a property and are buying a second or subsequent property, they will pay an additional stamp duty of 3%.
The Singapore government said that this additional tax aims “to promote a sustainable residential property market where prices move in line with economic fundamentals.”
“Even with the current economic uncertainties, the demand for private residential property remains firm,” it said. “Given the uncertainty in stock markets and with interest rates remaining low, private property in Singapore continues to attract investors, local and foreign. Excessive investment demand will however make the property cycle more volatile, and thus increase the risks to our economy and banking system.”
Singapore property prices have risen for nine straight quarters. Current market prices are 13 percent above the previous peak in 1996 and about 70 percent higher than it was in 2006.
As a result of the government’s imposition of these new taxes on residential investments, the share prices of Singapore’s gone down by as much as seven percent on speculation that the new taxes will hurt sales and drive down property prices.