Second Reading Speech by Lee Hsien Loong, Deputy Prime Minister and Minister for Finance on The Property Tax (Amendment) Bill 2002 at The Parliament, 31 Oct 200208 Nov 2002
1. Mr Speaker, Sir, I beg to move, "That the Bill be now read a second time".
2. The Bill will amend the Property Tax Act to give legislative effect to the following measures:
a) To change the billing cycle for property tax from twice a year to once a year in January;
b) To abolish the practice of opening up the Valuation list, in the month of August, for public inspection and objection;
c) To allow taxpayers to lodge objections on the annual value of their properties at anytime within the current year.
d) To allow the Comptroller to impose a penalty not exceeding 5% of the amount of outstanding property tax immediately upon the expiration of the time period stipulated for payment;
e) To establish a Street and Building Names Board which will determine or alter the name of any building, estate or street;
3. I shall now explain the main amendments in the Bill.
Annual billing cycle for property tax
4. At present, property tax is payable half-yearly in advance in the months of January and July. Clause 3 of the Bill amends Section 6(2) of the Act to provide for property tax to be payable yearly in advance in January. Property tax bills will then be sent out only once a year. This will bring about cost and manpower savings.
5. Taxpayers paying their property tax through GIRO will not be affected, as they are already paying their property tax payments in 12 equal, interest-free, monthly instalments. Hence, IRAS will encourage those taxpayers currently paying their tax by cash or cheque to pay their tax through GIRO by sending them a package containing information of how to effect payment through GIRO.
Objections to the Valuation List
6. Currently, the Valuation List for the ensuing year is open to the public in August for inspection. Any owner aggrieved by the inclusion in the Valuation List of any property or by the annual value ascribed to a property may, at any time within the period allowed for inspection of the Valuation List, write to the Chief Assessor to object.
7. As taxpayers are informed of the annual values of their properties through their property tax bills or valuation notices, there is no need to publish the Valuation List for the public to inspect. Thus, Clause 5 of the Bill removes this practice. Clause 7 introduces a new Section 20A to the Act, which will allow taxpayers to object to the Chief Assessor with regard to the annual values ascribed to their properties at anytime of the year. If the Chief Assessor rejects a taxpayer's objection, the taxpayer may proceed to lodge an appeal with the Valuation Review Board within 21 days of the service of the notice of Chief Assessor's decision. This amendment effectively gives the taxpayer more flexibility to lodge an objection to the annual values of their properties.
Penalty for non-payment of tax
8. Under the current Act, if the property tax remains unpaid at the end of January and July, a notice would be served to the person liable. The taxpayer is required to pay the outstanding tax and a fee for the cost of the notice within 15 days from the service of the notice. A penalty may only be imposed upon the expiration of the requisite 15 days.
9. To encourage property owners to pay their taxes on time, Clause 16 introduces a new Section 36 to the Act to impose a penalty at the point the payment is due rather than after expiration of the notice demanding payment of outstanding tax. The penalty will be capped at 5% of the amount of outstanding property tax. However, the Comptroller will be given the discretion to waive the penalty imposed on late payment where there are exceptional circumstances.
The Street and Building Names Board (SBNB)
10. Currently, the Minister for Finance has authority to determine or change the name of any street, building and estate. He is assisted in this task by an advisory committee. In practice, most of the applications for names submitted to the committee are straightforward, and the committee's recommendations could be accepted without any amendment. Hence, Clause 18 amends Section 49 of the Act to establish the Street and Building Names Board and to vest in the Board the authority to determine or alter the names of any street, building and estate. The Chairman and members of the Board will be appointed by the Minister for Finance. There will also be an avenue to appeal to the Minister for Finance, against decisions made by the Board.
11. Mr. Speaker, Sir, I beg to move.
31 Oct 2002