Malaysia’s property management sector is pushing back against recent tax changes affecting commercial buildings. The Malaysian Institute of Property and Facility Managers has formally requested exemptions from sales and service tax for maintenance fees and sinking funds in stratified commercial properties, arguing these charges should not be taxable services.
While residential properties gained SST exemptions in April 2024, commercial properties still face a 6% tax on these essential contributions. Industry leaders warn this policy creates financial strain by reducing funds available for critical building maintenance and long-term repairs.
The MIPFM emphasizes that taxing sinking funds contradicts their intended purpose—saving for major future expenses like structural repairs and equipment replacements. The organization argues this approach unfairly burdens property owners who are already responsible for upkeep costs.
“Taxing maintenance contributions penalizes responsible property stewardship,” said MIPFM president Ishak Ismail. With living costs rising, the group contends this policy creates unnecessary financial pressure without clear public benefit. The appeal seeks alignment with residential property exemptions to ensure fair treatment across sectors.