This may be old news to some but the wife and I just realised that SINGLE person who buys a home to live in will be hit with the additional buyer's stamp duty (ABSD) if he does not dispose of his existing residence first.
That means a single person might have to find accommodation in between selling the old home and completing the purchase of the new one.
The clarification apparently came from the Ministry of Finance (MOF) on March 28th (not an excuse here but we were on vacation that week so that might explain the oversight), following uncertainty over whether stamp duty concessions for married people would also apply to singles ("No stamp duty relief for singles switching homes"; ST Forum, March 30)
Some married couples will get a refund of the ABSD if they dispose of their first property within six months of buying a resale home or the completion of an uncompleted one.
This relief is provided for joint purchases by married couples with at least one Singaporean spouse. Both parties must also not own any other property at the time of purchase to qualify.
But these do not extend to singles. This means singles will have to sell their existing home first before buying another - even if the new unit is meant for occupation and not investment. And if they do not comply with this rule, they will be hit with a hefty additional tax in the form of the ABSD.
The rule could mean much inconvenience, with single people having to find a rented place for the short term, bunk in with a family member temporarily or secure an extension of stay with the buyer between the transactions.
The new levy was part of the seventh and most extensive set of property cooling measures that were unveiled in January.
These slapped a 7% ABSD on Singaporeans buying their second home.
A spokesman from the MOF said that the Government raised the ABSD rates to moderate demand for properties and help cool the market. It limited ABSD concessions to a narrow group of buyers, namely Singaporean married couples, to help them acquire and upgrade their matrimonial homes. So if more groups, such as singles, were able to qualify for ABSD concessions, it would defeat the purpose of the cooling measures.
But some experts disagreed with the policy, noting that all Singaporeans should be treated equally, regardless of their marital status. They felt that singles should not be penalised as long as they will own just one house eventually. The ABSD relief offered to married couples should be extended to them as well, as long as they commit to selling their current home within six months of the purchase.
The Government's measure has prompted Ms Karen Yip to raise the question of whether there is a proven correlation between one's marital status and the runaway prices in the property market, or has the original cooling objective of the ABSD bifurcated into one that attempts to address demographic anomalies as well. She felt that such measure, as it stands, is not only unfair but also diminishes the value of Singapore citizenship for singles. After all, they also contribute to nation building and pay as much tax as married citizens, if not more. ("Stamp duty refund: Shed light on singles' exclusion"; ST Forum, April 19).
Maybe it's time for MOF to step onto the plate (again) and better explain the rationale for denying singles the ABSD remission?
8 comments:
It is indeed simple.
Concession is not equal to Entitlement.
Also, the concession was part of the package of measures to encourage becoming parents and to increase Singaporean core.
Hi Anonymous (19/4/13, 12:46PM),
There are already numerous incentives out there to entice citizens to become parents and to increase your so-called "Singaporean core", although the effects have not been overwhelmly encouraging. We can always proceed to debate about what/whether more incentives will change the mindset of our younger generation of Sinagporeans to get married earlier and have more children, but it is not our intention (nor the forum) to do so here.
IOHO (In our humble opinions), Singaporean singles are largely not opposed to added incentives given by the Government to encourage marriage and family building. And this includes providing ABSD remission. But to do so in the expense of "single" citizens do somewhat contradict one of the basic founding principles of our nation - equality.
Perhaps one option is to offer a "tiered system" whereby longer period of remission can be given to married citizens versus singles. It is still not entirely "equal" but at least it will come across as less... "discriminating"?
And if our Government is really concerned that by giving singles similiar remission benefits, it will negate the effects of ABSD, then maybe ABSD is really the incorrect mechanism to try and "kill 2 birds with 1 stone"...
I support the current ABSD way...it brings down the bubble...prices expected to drop 10 - 20% soon...difficult to find buyer's for the resale market...is a good sign for the market to stabilize...
I have only 1 thing to say to singles - get married then! Why must singles have it the same as married couples? Is it being fair & equal? Seriously?
Anonymous (20/4/13, 3:10PM):
So who died and made you the marriage Gestapo?
Or does being married elevate you to the same "pig status" as in George Orwell's farm?
Whether one choose to get married or remain single is entirely a personal choice and freedom. And if people tie the knot or start a family just because of the Government incentives or so that he/she can get the ABSD remission, then something is really wrong with our society these days.
So unless our national pledge was changed to "We, the MARRIED citizens of Singapore..." without my knowing, it IS about being non-discriminatory (I'm not even talking about fair & equal). Yes, seriously!
Then again, what chance do we have of being "one united people" given such mentality..?
so fierce ah? lol
Hi, thanks for the article. I did not know that singles cannot qualify for ABSD refunds.
Indeed it does appear that singles and married folks are treated differently, no wonder singles would cry foul...
HDB data says resale transaction down by 23% 1st Quarter compared to last quarter...Property heat is coming down...prices will get moderate...Condo resale transactions are also down...expected the prices to touch the basic by end 2013.
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