The government on Friday gazetted its vacancy tax bill, which is aimed at deterring property developers from hoarding flats and boosting housing supply.

According to the Rating (Amendment) Bill 2019, all newly completed flats left empty, unsold and not rented out for more than six months in a year will be targeted.

The proposed tax rate will be equivalent to two years of rental income, based on market rates at the time.

The bill will be introduced at a regular Legco meeting, following the first council meeting after its summer break. It’s expected to come into effect three months after it’s endorsed by lawmakers.

In a message on social media, Chief Executive Carrie Lam – who made the vacancy tax proposal last year – said with the gazetting of the bill, all six housing initiatives she proposed a year ago have now been put in place.

Other housing measures include the delinking of the price of subsidised sale flats from market prices, and the reallocation of nine land sites from private to public use.

But the Real Estate Developers Association is against a vacancy tax, and has called on the government to put the proposal on hold.

The association says property prices are going down because of the China-US trade war and the ongoing unrest in Hong Kong, and introducing a new tax now could lead to an erosion of home values and threaten the overall financial system.
Last updated: 2019-09-13 HKT 12:57