After meeting with 11 MPs from Federal Territory of Kuala Lumpur on Thursday, Federal Territories Minister Tengku Adnan Tengku Mansor announced that he will review the proposed assessment hike for properties in Kuala Lumpur.
He said that he will come to a solution that will not burden the rakyat so much.
In view of the fact that there have been widespread and strong objections to the unjustifiable hike in assessment rates, I believe that a downward revision is no longer an option but a must for him.
As Tengku Adnan has not divulged any detail, it is unclear at this stage whether his solution will be satisfactory.
I have said in my press statement on November 17 that Tengku Adnan must be prepared to exercise his powers and reduce the percentage rate ( kadar taksiran ) imposed on properties as annual property assessment rate ( taksiran tahunan) is calculated according to the following formula :-
Annual value x percentage rate = annual assessment rate
Presently, the percentage rates imposed on DBKL residential and commercial properties are 6% and 12 % respectively.
An example is as follows:
For a house with old annual value of RM 10000, the assessment rate will be RM 600.
If the annual value has doubled to RM 20000 and percentage rate remains at 6 %, the new assessment rate will be RM 1200.
But if percentage rate imposed is reduced to 3%, the new assessment rate will remain the same at RM 600.
Hence, it is clear that even if a property revaluation exercise causes the annual value of a property to rise steeply, it does not mean that the assessment rate must go up or must go up exorbitantly.
Three days ago, former Mayor Tan Sri Eylas has weighed in on the issue. He has said that City Hall has bigger revenue today and there is no need to increase assessment by even 10%. He also said that there are many ways that City Hall can generate income.
Many city dwellers have told me that if an increase in assessment rate is unavoidable, they expect an increase of not more than 5 % to be a reasonable figure.
In the mean time, city dwellers aggrieved on the ground that their property is rated beyond its rateable must continue to submit their objections to Kuala Lumpur City Hall before the deadline, in accordance with section 142 of the 1976 Local Government Act.
Let there be hundreds of thousands of objection letters submitted to the City Hall. Let the massive objections also be a form of pressure to the Federal Territories Minister Tengku Adnan to come out with an acceptable solution.