HBA honorary secretary-general Chang Kim Loong said property formed the largest component of wealth or estate of most people, especially parents who wished to provide a better start for their children.
An inheritance tax is believed to be among five new taxes proposed for the 2025 federal budget to be tabled this month. It would be levied on the assets or wealth inherited by beneficiaries after one’s death.
Chang said the proposed tax is expected to be imposed on the estimated current market value of the estate. As property prices rise over the years, driven by inflation, "beneficiaries of such properties are effectively paying a tax on the inflation rate suffered since acquiring the said property," he said.
The tax might encourage people to spend rather than save, as it is "akin to punishing those who managed to succeed".
"Inheritance tax is effectively sending the message to civil society not to work so hard or to save money for investments, but just to have a happy-go-lucky lifestyle and spend all that we earn as we will be taxed again when we die for any assets that we have accumulated from our years of blood, sweat and tears," he said.
