Lim: Homes should be cheaper with SST exemption on construction services

GEORGE TOWN: Finance Minister Lim Guan Eng expects property developers to lower their housing prices as construction services have been exempted from the Sales and Services Tax (SST). He believes developers could pass on the savings to consumers.
"Associations such as the Real Estate and Housing Developers Association have praised the government for allowing such exemptions," he said at an SST briefing for representatives from various industries and businesses today.
"We want to see the positive results in the market. For now, the prices remained quite steep."
He said if the prices do not depreciate, the Ministry would reconsider the exemption.
Lim also said the SST has a credit system where businesses who contribute excess amounts could apply for reimbursements.
Earlier, the Royal Customs and Excise Department director-general Datuk Seri Subromaniam Tholasy revealed that 85% of traders would not have to pay SST, compared to the GST where everyone was subjected to the multi-layered consumption tax.
He said living costs went up during the GST era because Customs had struggled to refund within 14 days the rebates submitted by the traders.
"I have to admit the funds were not there," he said. "It was not in our trust fund. It was deposited into our consolidated fund.
"When this happened was that traders became distrustful of the tax system and began to impose higher pricing on their items because they did not receive the rebates."