In response to media enquiries concerning certain reports quoting Government sources speculating that the stamp duty would be raised to 4.5% for luxurious property transactions in excess of HK$20 million, a spokesman of The Real Estate Developers Association of Hong Kong made the following remarks.
“The timing of such a move is unfortunate given current uncertainties in the capital markets and the rationale for such an increase is questionable. If the reports were true, it would be direct interference in the market by the Administration. This runs in direct contravention to the spirit of “Big Market, Small Government”.
“The rise in the price of luxurious properties is largely a reflection of the under supply of such products in the market. The Government is fully capable of addressing this issue by putting more sites for luxurious residential developments in the Land Application List.
“Furthermore, luxurious property is very much location-dependent. Statistics have shown that property transactions of HK$20 million are on the rise. Defining this particular class of properties as luxurious and raising the stamp duty on them will only penalize the middle class and frustrate their aspirations to upgrading their living standard by trading up on the property ladder. We have grave reservation on this proposal.”