Debated in Parliament on 8 Jan 2025.
Mr Yip Hon Weng asked the Prime Minister and Minister for Finance regarding the one-off property tax rebate for owner-occupied homes (a) whether there are other measures to address longer-term housing affordability and cost-of-living concerns for homeowners as this rebate offers only temporary relief; and (b) whether the Ministry will consider reviewing the property tax rate structure, extending the rebate, as well as additional direct housing schemes or subsidies and further improve housing affordability for Singaporeans.
The Government is committed to keep public housing affordable, accessible and inclusive for Singaporeans. Eligible first-timer families buying a Build-To-Order (BTO) flat can receive up to $120,000 in housing grants, on top of significant market discount in the selling price of the BTO flat. Those buying a resale Housing and Development Board (HDB) flat can receive up to $230,000 in housing grants. Under the new flat classification framework implemented from October 2024, Plus and Prime BTO flats come with additional subsidies and tighter restrictions to ensure that flats in attractive locations remain affordable to a wider range of incomes, while maintaining a good social mix in our HDB estates and keeping the system fair for all buyers.
To cater to private housing demand and maintain market stability, the Government closely monitors Government Land Sales supply and regularly releases land to meet market demand.
The Government also introduced four rounds of cooling measures in December 2021, September 2022, April 2023 and August 2024 to stabilise prices in both the HDB resale market and the wider Singapore property market.
Property Tax (PT) is a tax on property ownership and our principal means of taxing wealth. Over the years, we have taken steps to make our PT regime more progressive, such that those with high-value properties as well as those with non-owner-occupied properties, pay higher PT. This is in line with what Members from both sides of the House have asked for: more progressive taxation on wealth.
To cushion the impact of a higher PT, the Government provided a PT rebate of 20% for owner-occupied HDB flats and 15%, capped at $1,000, for owner-occupied private residential properties in 2025.
Mr Yip asked if the Government would consider reviewing the PT rate structure. We have indeed done so. At Budget 2024, the Government announced that in light of the market trends in the last two years, all Annual Value (AV) bands of the owner-occupier residential PT rates will be raised with effect from 1 January 2025. This means that the first AV band will be raised from $8,000 to $12,000, with corresponding adjustments to the other bands.
As a result of both of these measures, all owner-occupied HDB flats and over 90% of owner-occupied private residential properties, will see lower PT in 2025 compared to 2024.
Besides PT rebates, the Government has also rolled out measures to support all Singaporeans with their cost of living. In particular, we have enhanced the Assurance Package to more than $10 billion. The enhancements include measures, such as the Budget 2024 Cost-of-Living Special Payment that was disbursed in September 2024, Community Development Council (CDC) vouchers and additional utilities save (U-Save) and service and conservancy charges rebates.
We will continue to ensure that public housing remains affordable and accessible to all Singaporeans, and that our overall system of taxes and transfers remains fair and progressive so that those with greater means contribute more and more help is given to lower- and middle-income Singaporeans.
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