Property transfer rules are encouraging money laundering and speculation, say members of the real estate industry.

They singled out for criticism a rule that allows property buyers to avoid declaring the source of their income by paying a 30 percent tax.

A property buyer who does not want to reveal their income must pay a 30 percent tax on the purchase amount as well as seven percent stamp duty, real estate consultant Daw Swe Swe Myint told Mizzima on August 26.

“When the buyer sells the property they pay ten percent tax and the rest becomes ‘clean’ money,” she said.

Asia Real Estate manager U Saing Li said the rules were encouraging property speculation and increasing land costs, especially in industrial zones.

U Kyaw Kyaw, the vice chairman of Shwe Pyitha industrial zone management committee, said speculation was hampering development.

“Many of those buying land are not real industrialists,” said U Kyaw Kyaw. “They are buying with the sole intention of re-selling at a higher price and the real industrialists are being priced out of the market,” he said.

Link: http://www.mizzima.com/business/property/item/12300-property-transfer-rules-blamed-for-money-laundering-speculation