Financial Secretary Paul Chan Mo-po said on Wednesday that the government will raise stamp duty on residential properties valued over $100 million from 4.25 percent to 6.5 percent, seeking to increase its revenue amid the boosting luxury property market in Hong Kong.
For homes valued from HK$100,000,001 to HK$109,574,470, the stamp duty will be counted by HK$4,250,000 plus 30 percent of the part of the consideration in excess of HK$100 million.
Residential properties valued at HK$109,574,471 and above will be subject to the 6.5 percent stamp duty rate.
The move will affect about 0.3 percent of residential property transactions, which is estimated to increase about HK$1 billion per annum of the government's revenue, Chan said.
The adjustment will be effective from Thursday.
A government source emphasized that this action will has no impact on the current improving market sentiment or trend, adding that less than 200 deals of over HK$100 million were recorded among 65,000 transactions in the first ten months of this fiscal year.
While luxury homebuyers face higher stamp duty costs, these high-net-worth individuals are relatively less price-sensitive, said Kathy Lee, head of Research and Retail Consultancy of Colliers.
In contrast, Hannah Jeong, head of Valuation & Advisory Services at CBRE Hong Kong, said raising upfront costs risks suppressing genuine upgrade demand and slowing capital circulation in the luxury segment amid the recovering property market.
While the policy may aim to raise revenue instead of curb speculative activity, the ultra‑luxury market is already highly end‑user‑driven with limited speculation, she said.
CBRE also revised the luxury residential price to remain flat from a 0 to 5 percent growth after this policy announcement.
Source: The Standard
