Singaporeans should not delude themselves and continue to believe we own our HDB flats. link
PAP knows that non-ownership means there’s no need to pay any property tax. But since it needs to give the illusion of ownership, HDB lessees living in 3-room flats or bigger are only required to pay a token amount.
HDB property tax is in fact additional revenue for the government because it is the real owner of all HDB flats, not buyers.
Strangely, even elected opposition party members have not highlighted this issue in Parliament.
Singaporeans had also been forced to pay annual TV license fee of $110 for decades but this was finally scrapped in 2011. For decades, Mediacorp was earning advertising revenue to churn out propaganda for PAP while TV and radio owners were forced to fund Mediacorp.
The token HDB property tax is gradually being reduced and is also likely to be scrapped.
PAP’s arbitrary Annual Valuation (AV) determines the amount of property tax to be paid. If the IRAS says the AV of our HDB flats is $X, then we simply have to pay the tax rate on $X. IRAS example
The problem with IRAS is that it has not been able to explain why AVs of HDB flats are unbelievably low. IRAS reply (AV is derived from market rental rates of similar properties less maintenance cost, furniture and furnishing.)
To cut the story short, I’ll use my executive flat as an example. Although the median transacted rental of similar executive flats was about $2,600 per month or $31,200 per year, IRAS stated the AV of my executive flat to be only $11,200 in 2015. What this implies is the annual maintenance and furnishing costs amounted to $19,980.
According to IRAS, the calculation of AV takes into account “a reasonable allowance for furniture , furnishings and maintenance fees”. Is 64% of total rental “a reasonable allowance” by any measure? How could maintenance and depreciation amount to $1665 per month? Are executive HDB flats as luxuriously furnished as former PAP MP Michael Lim’s chateau? (image below)
Any vacant executive flat could have been easily rented out at about $2000 per month and the explanation by IRAS is really absurd.
AV of HDB flats should not be an arbitrary figure pluck from thin air to suit PAP’s political agenda.
Guess it’s about time for PAP to scrap HDB property tax.