3
THURSDAY, DECEMBER 28, 1991
"IF THIS TREND WERE TO CONTINUE, WE WOULD
HAVE TO CONSIDER
NEW-
APPROPRIATE ACTION. BUT FOR THE TIME BEING, WE PROPOSE THAT THE STAMP DUTY REQUIREMENT SHOULD ONLY APPLY TO RESIDENTIAL PROPERTY, HE SAID.
"CERTAIN TYPES OF RESIDENTIAL PROPERTY, WHICH ARE NOT SUBJECT TO SPECULATION, WILL ALSO BE EXEMPTED, THE SPOKESMAN ADDED.
TI
THESE INCLUDE HOME OWNERSHIP SCHEME FLATS, CONSULAR PREMISES AND PROPERTY BOUGHT BY THE GOVERNMENT.
UNDER THE BILL. BOTH THE BUYER AND THE SELLER OF ANY LAND OR BUILDINGS WILL HAVE TO EXECUTE A WRITTEN SALE AGREEMENT. THE AGREEMENT MUST CONTAIN A DECLARATION AS TO WHETHER THE PROPERTY IS RESIDENTIAL OR NON-RESIDENTIAL.
"NO DUTY WILL BE PAYABLE IF THE PROPERTY IS DECLARED то BE ENTIRELY FOR NON-RESIDENTIAL PURPOSES, PROVIDED THAT THE COMMISSIONER OF INLAND REVENUE HAS NO DOUBTS, THE SPOKESMAN SAID.
**
"THE INTENTION OF THE BILL IS TO PROMOTE GENUINE HOME PURCHASES AND ΤΟ DISCOURAGE SPECULATIVE TRANSACTIONS. FOR THIS REASON, THE STAMP DUTY PAYABLE ON THE ACTUAL CONVEYANCE OF A PROPERTY WILL BE LIMITED TO A NOMINAL $100.'
MOST OF THE NEW LEGISLATIVE PROVISIONS WILL BE CONTAINED IN A NEW PART (PART II A) OF THE STAMP DUTY ORDINANCE.
"THIS WILL MAKE THEIR INTENTION CLEARER, AND ALSO MAKE IT EASIER TO INTRODUCE ANY AMENDMENTS WHICH MAY BE REQUIRED BY CHANGING CIRCUMSTANCES, THE SPOKESMAN SAID.
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THE NEW MEASURES WILL REMAIN IN FORCE UNTIL DECEMBER 31, 1993. THEY CAN THEN BE ONLY EXTENDED BY RESOLUTION OF THE LEGISLATIVE COUNCIL.
"WE WILL REVIEW THE CONTINUED NEED FOR THE MEASURES ABOUT SIX MONTHS BEFORE THE EXPIRY DATE, TAKING INTO ACCOUNT DEVELOPMENTS IN THE ECONOMY AND ESPECIALLY IN THE PROPERTY MARKET," THE SPOKESMAN SAID.
HE SAID THAT, IN ADDITION TO THE MEASURES DESIGNED TO COMBAT RECENT LEVELS OF SPECULATION IN DOMESTIC PROPERTY, THE BILL ALSO CLOSED AN EXISTING TAX AVOIDANCE LOOPHOLE.
"AS THE LAW STANDS, A SHAREHOLDER IN A COMPANY WHICH OWNS PROPERTY CAN TRANSFER HIS INTEREST IN THE PROPERTY BY SELLING HIS SHARES TO ANOTHER PARTY. HE IS THEN ONLY LIABLE TO PAY DUTY AT THE CONTRACT NOTE RATE, THAT IS $5 PER $1,000," THE SPOKESMAN EXPLAINED.
**IN
SOME CASES, A COMPANY IS DELIBERATELY SET UP TO AVOID THE NEED TO PAY DUTY AT THE HIGHER, CONVEYANCING RATE, THAT IS $27.50 PER $1,000. THE BILL CONTAINS PROVISIONS TO MINIMISE THIS FORM OF AVOIDANCE, THE SPOKESMAN SAID.
TAX
IT
IS INTENDED THAT THESE PROVISIONS SHOULD FORM A FEATURE OF THE ORDINANCE.
PERMANENT
0
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