Yesterday, it was announced that Johor will be implementing higher tax rates for foreign owned properties by the end of this year. This will affect almost 130,000 foreigners.
The new rates are still being discussed but will be imposed by the end of the year.
Depending on what the new rates are, they might or might not dampen buying interest in the Iskandar region, where there are many Singapore buyers.
But I do like this approach as a means of curbing property demand.
Instead of increasing the buyer’s stamp duty (what Singapore has done) which only affects new buyers, a property tax will affect both existing and new buyers. Taxing all foreign owners while leaving local owners untouched is not only politically correct, but also helps to prevent prices from escalating too much.