The real estate sector recorded the highest share of foreign fund inflows at US$274.68 million in October, the first month of the current financial year, after Hong Kong-listed Amata Company invested in the development and operation of Smart and Eco City and related businesses on 2,000 acres of land near East and South Dagon townships.
In October, six other enterprises invested over $10 million in the manufacturing sector, while two enterprises pumped in $6.47 million into the other services sector, according to statistics released by the Directorate of Investment and Company Administration (DICA).
So far, domestic investments from 87 enterprises in the real estate sector have reached K4,421 billion, according to the DICA.
More than 22 per cent of domestic investments made by Myanmar citizens have flowed into the real estate sector, while investments have also been made in manufacturing, hotels and tourism, construction, industrial estate, energy, mining, livestock and fisheries, agriculture, and other services sectors, according to the DICA.
Realtors are expecting the reduced income tax to stimulate the realty market, which has been cool for the last three years. They also anticipate the approval of a real estate service law, which would regulate informal deals and prevent buyers and sellers from being defrauded by unscrupulous realtors, according to real estate officials.
At present, buyers and sellers have been forced to avoid paying taxes, owing to high appraisal and tax rates. Most dealers are informally carrying out real estate deals using only the special and general power of attorney, said realtors.
The reduction in taxes is likely to persuade traders who evaded taxes in previous years to pay taxes and make changes in ownership, they added.
For the 2019-2020 financial year, the standard land price per square foot in Yangon’s townships has been reduced by 10 per cent compared to the year-ago period, according to the Internal Revenue Department. These prices are used for tax evaluations in real estate sales.
As per the Condominium Law, when a condominium project developed by a citizen or a foreigner is completed, foreigners have the right to own up to 40 per cent of the units. – Pwin Thit Sar/Ko Khant
(Translated by Ei Myat Mon)