Stamp Duty Amendments gazetted

Stamp Duty (Amendment) Bill 2013 will implement new measures to cool overheated property market.

Gazetted in Hong Kong last April 5, the amendments increase the ad valorem stamp duty (AVD) rates on transactions for residential and non-residential properties and a bringing forward of the charging of AVD on non-residential property transactions from the conveyance on sale to the agreement for sale to tally with the existing arrangement for residential properties.

Hong Kong implemented these measures after previous measures imposed in in October 2012 showed no lasting effect on property price inflation. The previous measures were the Special Stamp Duty (SSD) rate and its restriction period, and the introduction of a 15% Buyer's Stamp Duty (BSD) on resident properties purchased by those who are not Hong Kong permanent residents.

With effect from February 23, 2013, the government doubled across the board the rates of existing AVD applicable to both residential and non-residential properties. For transactions valued at HK$ million or below, the stamp duty will increase from HK$100 to 1.5% per cent of the consideration of the transaction.

The new measures are applicable to all persons, except HKPRs, buying residential properties but who do not own any such property in Hong Kong on the date of acquisition.