Development charge rates cut for non-landed residential use for a second time, but raised for commercial uses

The average reduction of 0.3 per cent for non-landed residential use compares with a 5.5 per cent drop at the rate revision in March - the first time they had been lowered in three years.
The average reduction of 0.3 per cent for non-landed residential use compares with a 5.5 per cent drop at the rate revision in March - the first time they had been lowered in three years.PHOTO: ST FILE

SINGAPORE - The government has again cut development charge (DC) rates for non-landed residential use amid a softer private residential market.

The average reduction of 0.3 per cent compares with a 5.5 per cent drop at the rate revision in March - the first time they had been lowered in three years.

It contrasts with a 9.8 per cent rise in September last year.

Developers pay DCs for the right to enhance the use of some sites or to build bigger projects on them.

The September revision has hiked DC rates for commercial use by 1.7 per cent on average after being lifted 9.8 per cent in March. DC rates for the use group that includes hotels and hospitals have remained unchanged following a 45.6 per cent rise in March.

The new rates are for the period Sept 1 to Feb 29, 2020.

The National Development Ministry revises the rates on March 1 and Sept 1 each year, in consultation with the taxman's chief valuer.

They are based on the chief valuer's assessment of land values and factor in recent land sales. They are stated according to use groups across 118 geographical sectors in Singapore.

Rates remain unchanged for landed residential, industrial and place of worship/civic and community institution uses as well as for three other land-use groups - nature reserves, agricultural land, drains, roads, railways and cemeteries.

They have been reduced for non-landed residential use in seven out of 118 geographical sectors by between 4 per cent and 7 per cent but left untouched for the remaining 111 sectors.

The biggest drop of 7 per cent applies to the following sectors:

Sector 112 - Pan-Island Expressway/Bukit Batok East Avenue 6;

Upper Bukit Timah Road/Clementi Road/West Coast Highway; and

Penjuru Road/Jalan Buroh/Jurong East Area;

DC rates for the commercial use group were raised in 59 sectors by between 3 per cent and 7 per cent, with no change for the remaining 59 sectors.

The largest increase of 7 per cent is for the following sectors:

Sector 100 - Tampines Road/Hougang/Punggol/Sengkang area;

Sector 105 - Ang Mo Kio/Yio Chu Kang/Seletar area;

Sector 112 - Pan-Island Expressway/Bukit Batok East Avenue 6;

Upper Bukit Timah Road/Clementi Road/West Coast Highway; and

Penjuru Road/Jalan Buroh/Jurong East Area.