Commercial premises in the country will be granted tax relief by the government, applicable to property owners providing rental discounts to their tenants.
Minister of Home Affairs in a press briefing on Thursday said that His Majesty the Sultan and Yang Di-Pertuan of Brunei Darussalam has consented to the reduction of the annual commercial property tax for 2020.
Yang Berhormat Pehin Orang Kaya Dato Seri Setia (Dr) Hj Abu Bakar said the tax relief is up to 50 per cent, depending on the discounted monthly rentals given to the lessee.
Landlords giving 10 – 14 per cent deduction on rentals will be given a 20 per cent tax relief; a 35 per cent off will be granted to owners giving tenants 15 – 19 per cent discount; and owners giving more than 20 per cent reduction will get 50 per cent tax cut.
“Property owners who did not reduce their tenants’ rent or less than 10 per cent will not be given any cut for their building tax,” said the home affairs minister.
It is hoped that landlords will be able to cooperate in offering lesser rent especially during this challenging time caused by the COVID-19 outbreak in the country, he added.
Furthermore, the building tax cut which is given to property or commercial space owner giving less or free rental to tenants, is based on four requirements.
1. Property owner must reduce monthly rent at least 10 per cent off for six months.
2. Tax cut is applicable to premises that are for commercial use such as trading, industrial and special real estate; and home-based businesses like day care, tailor or convenient store.
3. Consideration of tax reduction given to landlords with outstanding payment is subject to the following:
- Property owners must at least settle 10 per cent of the arrears;
- Property owners who have not paid 10 per cent of the arrears need to provide a written commitment by signing the settlement agreement.
4. Property owners to submit application with necessary documents and complete details to the municipal department.
The relief is part of the economic stimulus package previously introduced by the Minister of Finance and Economy II in helping businesses impacted by the pandemic.
YB Pehin (Dr) Hj Abu Bakar further said that the tax cut serves as an incentive to commercial property owners to lessen tenants’ burden whose businesses are affected by the virus outbreak.
“Landlords were to either reduce rent or no rent at all until the situation improves. This is line with His Majesty’s recent titah concerning COVID-19,” said the minister, adding that the relief will help taxpayers’ and tenants’ cash flow.
The Bruneian | BANDAR SERI BEGAWAN