AL Plenary All stamp duty law amendments passed bar one

Vong Hin Fai contested many aspects of the proposal

Yesterday, the Legislative Assembly (AL) passed amendments proposed to enforce the stamp duty in instances of the acquisition of second (and subsequent) housing units. These amendments are among the measures considered by the government to cool down the real estate market and avoid speculation.

Several lawmakers expressed doubts about the effectiveness of the amendments and abstained or voted against most of its articles.

Criticism was centered around article 5 of the proposal, where the government aimed to consider for taxation purposes any member of a couple as individuals rather than a married entity. 

This generated a broad discussion started by lawmaker Vong Hin Fai, who claimed that the proposal from the government to disregard the marital status and regime between couples on taxation matters clashed with Macau’s Civil Code.

Vong also addressed several other issues, including the wording of the law, especially in the Portuguese version, as he claimed that some concepts did not align between the Chinese and Portuguese versions. For example, he requested  the change of wording from “possession” to “entitlement.” The article was voted down.

On the government side, Secretary for Economy and Finance Lionel Leong tried to explain that the government “had little time to produce this bill” and that further amendments could be made in the future to match the Chinese and Portuguese versions. 

Lawmakers Ip Sio Kai and Mak Soi Kun followed Vong to criticize the manner in which the government was “disregarding” the Civil Code and the marital regimes, with Mak questioning the application of such a law in the cases of non-marital partnerships.

Si Ka Lon was another lawmaker expressing clear opposition to the norm, eventually proposing a separate vote of the mentioned article, leading to its defeat.

Leong tried without success to make use of his legal advisor to explain that there is no intention to clash with the Civil Code, which was repeated on the government side, as the explanation was forthcoming and this was an exception only for the purpose of the tax law. Ultimately the distinction was drawn to be clear that “this is a political matter, not a legal one,” and in cases of the law, legislators should not focus on particular instances but society as a whole.

The representative of the Financial Services Bureau (DSF) contributed that, “the norm won’t affect the marital regime. It only aims to avoid a great volume of work [to its services] to confirm all the situations and all the marital regimes of people every time someone is buying a house.” He warned, “if this [article] is removed from the law, some people might use this legal loophole not to pay taxes by alternating their marital regime.”
Vong continued to disagree and cited his experience as a university teacher of law to support his view, which many others shared.

In relation to other parts of the bill, Ip again spoke, noting  that the model chosen for this bill “lacks in precision” and “does not take into account the size of the housing units, the age or any other factors.” He claimed that, “the government wants the elderlies to live within the families but disregards the fact that those families might need another housing unit or a bigger one in order to achieve that, making them pay more taxes for that.”
Mak agreed with Ip and requested an exemption for those cases so that families can live together, or near to one another.
In a flat and dull speech, Leong continued to reaffirm the bill’s intention to “discourage people from buying a second house to speculate,” saying, “we really want to reduce or to finish with the speculation.” He further noted that if a second house is bought  “to replace another one, a refund [of the stamp duty paid] will be made within a one-year period.”

“We hope that our scarce resources [on housing] can be better utilized,” Leong concluded.

Kou Hoi In also expressed his disagreement with the measure, saying: “This is a sanction for Macau people! Why the government does not make a substantive change to the Stamp Duty law [instead]?” adding,  “If I want to acquire a unit for my parents or to my descendants, why do I need to pay more for that?”

In response, the Secretary for Economy and Finance replied that tax evasion may occur when, “second and third houses could be acquired in the name of other family members.”
Pro-democrats Au Kam San and Ng Kuok Cheong claimed, “if before it was already difficult to move into a bigger house, from now on it will be impossible. We are doing the opposite. We are discouraging.”

Ng has noted a “clear gap between the initial idea and the outcome,” adding, “we are not addressing [measures to prevent] speculation but instead we are addressing daily household issues. Houses to live in do not cause speculation. We cannot understand the logic of the government. It seems that the intention is not to fight speculation, but to prevent families from buying houses to live in. This makes no sense and has no logic.”

The deadlock created then led Leong to call for a “break time,” which AL president Ho Iat Seng accepted.
After the break, the voting on the remaining articles of the bill proceeded. The large majority of votes were in favor, aside for Au and Ng who voted against, and Kou who continued to abstain.