Rental contracts to require legal aide

The article-by-article discussion of a law that introduces a rental control mechanism continued yesterday, with the Third Standing Committee of the Legislative Assembly (AL) agreeing to introduce a requirement to have rental contract signatures notarized. This will require the presence of a person authorized by law to draw up or certify contracts, and the contract and rental agreements will have to be registered with the notary.
The new measure will crackdown on landlords who are avoiding tax payments on their properties.
“The government has no way of knowing how many contracts are signed [at any given time], with this requirement, there has to be a proof of the payment of the due taxes,” argued the president of the committee Cheang Chi Keong, as cited in a TDM report. “As a result, it would be impossible to bypass the finances.”
In addition to the stamp duty, landlords will now also be required to pay a tax on rental income as well as an additional urban contribution.
However, lawmaker Cheang maintained that the new measures would not create upward pressures on rental prices: “The landlord has to take up the expenses. How that will work out, we’re not yet sure.”
Last month Cheang Chi Keong raised a proposal that could see property rental reviews go up as much as 29 percent, which was hotly contested.
With the intention of limiting the rise in rental prices in Macau, lawmaker Cheang said then that he saw no contradiction between setting the maximum increase at 29 percent and meeting the intention of reviewing rental increases.
The next meeting of the Third Standing Committee of the AL will see lawmakers resume the debate on the issue of the duration of rental contracts. Current suggestions include a two-year minimum for housing contracts and a further one-year extension for commercial contracts.