Should PRs Leaving SG be Allowed to Keep HDB Sales Proceed?

[Scion]

https://sg.finance.yahoo.com/news/prs-leaving-singapore-allowed-keep-160000226.html

 

Should PRs Leaving Singapore be Allowed to Keep All of Their HDB Sales Proceeds?

 

What enrages you more? The fact that you can’t cash out your Central Provident Fund (CPF) account unless you renounce your citizenship, or that Singapore Permanent Residents (PRs) can withdraw all of their CPF funds AND Housing and Development Board (HDB) sales proceeds with them when they leave Singapore?

 

Understandably, you’re pissed off because it’s not fair that someone from another country can take part in your social security program (CPF), use it as a glorified saving account, and withdraw all of it when he/she moves back home.

Let’s not forget the property issue as well. A PR flipping his/her property before leaving Singapore can easily make several hundred thousand dollars – more than enough to buy a huge landed property in 75% of the world.

These are issues that beg the question, “Should PRs be allowed to cash out whenever it’s convenient, or should they pay their fair share?”

 

The CPF “Cash Out” Issue

The issue of CPF withdrawal has become an increasingly hot topic among Singaporeans. That’s because Singaporeans feel frustrated that they have little control over when and how much money they can withdraw.

In fact, an ex-CPF employee confirmed that in our article about the 3 Biggest Complaints Singaporeans Have About Their CPF Accounts. CPF is a well-intentioned social security system, but it’s not very flexible – you can’t use it if you get retrenched or have a major financial emergency, even if you have $100,000+ in your CPF account.

PRs also contribute to CPF and benefit from many of the social programs offered to Singapore citizens. However, unlike Singaporeans, they can withdraw all of their CPF account after renouncing their PR status.

Well, you can too – if you renounce your citizenship.

In a way, CPF is also like a piggy bank that gives PRs access to a “savings account” that gives them 2.5% interest, which is exponentially better than the “normal” savings account interest rate in Singapore, which is 0.01%-0.05%!

Recently, CNA reported that according to Manpower Minister Tan Chuan-Jin, over the last decade more than $4 billion dollars (avg. $426 million each year) was withdrawn from CPF members leaving Singapore.

Currently, CPF doesn’t track how much is withdrawn by PRs and former Singapore citizens. But does that really matter? After all, if there are more PRs cashing out, it shows that they’re just using CPF as a piggy that they can crack open before heading home.

And if a higher percentage of ex-Singaporeans are the ones cashing out, what does that say about the system, especially if these former citizens are leaving Singapore because of the inflexibility of CPF?

 

The HDB Flat “Flipping” Issue

“Flipping” property boils down to this simple definition – purchasing real estate below market value and selling the property when the market rises, usually within a short period of time. For people who flip property, their intention isn’t to live there “permanently,” but to sell it for a profit.

In terms of citizens and PRs, who do you think is more likely to buy a property and live in it on a “permanent” basis?

The answer is a no-brainer, and that’s what angers Singaporeans – the fact that PRs jumping ship to go home can just “flip” their property and leave Singapore like a bandit walking out of a bank.

Of course, Singapore does have the Seller Stamp Duty (SSD), which is meant to prevent short-term “flipping” by imposing a tax of:

• 16% of the price or market value (whichever is higher) if you sell within 1 year
• 12% of the price or market value (whichever is higher) if you sell within 2 years
• 8% of the price or market value (whichever is higher) if you sell within 3 years
• 4% of the price or market value (whichever is higher) if you sell within 4 years

However, four years isn’t a very long time. While the SSD inflicts enough financial pain to discourage short-term flipping, it won’t do much to dissuade a PR from selling his property, especially since most PRs are in Singapore for a longer period of time.

 

What Can Be Done to Ensure PRs Pay Their Fair Share?

“Permanent Resident,” isn’t that term ironic? Think about it, many don’t even stay and contribute to Singapore “permanently.” But this isn’t what infuriates most Singaporeans.

What really pisses Singaporeans off is how incredibly easy it is for PRs to “escape” Singapore and go back home after they’ve made their fortune. Singaporeans don’t have that option – there’s no place to escape to.

There’s no way you can ever “cash out” of the system – unless you renounce your citizenship. Where’s the fairness in giving PRs the ability to cash out without any sort of penalty?

Change has to come from the top. There’s no way around that. So what can be done to ensure there’s more “fairness” in the way the government handles PRs who choose to renounce their status?

Here are a few humble suggestions to ensure PRs pay their fair share and aren’t given “preference” over Singaporeans when it comes to their CPF accounts and property sales:

• Impose a Tax on PRs Withdrawing All Their CPF (ex. 20% Withdrawal Tax)
• Impose a 10% Lifetime Seller Stamp Duty (SSD) on PRs Selling Their Homes Unless They Become Citizens
• Give PRs a Lower CPF OA Interest Rate Unless They Become Citizens (ex. 1% lower than Citizens)
• PRs Renouncing their Status Must Sell Any Property They Own
• PRs Renouncing their Status Cannot Regain It a Second Time

These are just a few suggestions that can help alleviate some of the anger Singaporeans feel about PRs who leave the country after making their fortunes.

What are your suggestions?

 

 

 

yip • 1 hour 5 minutes agoReport Abuse

 

excuse me . PR and Singaporean are paying the same % of CPF contribution. Work here als o spending here . No different ....their hard earn money too. What's wrong if they take their own hard earn money when leaving. Dont tell me you not going to take your money if you want to leave Singapore ??? What is the different when Singaporean forgo their citizenship , sell the hse and take the money to migrate to elsewhere .... Not the same ?? PR are not taking someone else money but their own saving money OK !!.....

 

 

AyeChan • 3 hours agoReport Abuse

 

Goddamnit!!! PRs can only buy a resale flat with some restrictions... which means it's not your Gov who's giving HDB to PRs... it's you guys making profit out of homeless people who are contributing to your society. FYI, I'm living in a rented place (3NG) which cost me SGD2000 a month, $24K a yr and I paid almost $200K over 9yrs, in Cash (non-CPF). Do I own an HDB!? Hell, NO... I'm not even eligible. So what was your complaint again!?

Yah • 15 hours agoReport Abuse

 

Singapore belongs to everyone.

 

Do not be selfish.

 

Sinkies

 

Pls do not behave like Racial Supremist denying other groups of a fair return that they duly deserved.

 

Ask yourself, what if you are a PR instead of being a Sinkie? Would you want to be able to sell your HDB flat and take the earnings, retrieve your CPF entirely and go back to your home country?

 

Would you, or won't you want to be able to?

 

Stop being a hypocrite and start living like a real human being. Have a heart on those PRs and Foreigners, you Sinkies !!!

 

 

Tan • 14 hours agoReport Abuse

 

Writer Jeff Cuellar and Yahoo Singapore, stop all this propaganda of trying to create uneasiness and unfairness to Singaporeans. Your article will create more discrimination and society bias among Singaporeans. You are trying to create social disharmony by writing an article directing at PRs. It may seem PRs tend to enjoy certain benefits more than Singaporeans. But the truth is, you report the surface information only. Your article didn't mentioned the details such as PR pay much higher interest rates to buy HDB compared to Singaporeans; and the fact that they can only buy resale units means at the end of 30 year loan, PR pays hundreds of thousands of dollars more than what a Singaporean pay just to own a flat. If you did your homework well, you will realize how much sky rocket price PRs need to pay just to purchase a HDB flat. However, one thing I am very sure about the author of this article. The author is targeting PRs and cultivating a sense of injustice among Singaporeans. And if you ever realize, just by writing such a report, there may be more Singaporeans targeting PRs for every small unhappiness they have. But to the PRs, it is hundreds of thousands of lives you are affecting which includes their families too. Spare a thought to others when you write such an article because your article can lead to devastating consequences. If the end who emerge as victors? The answer is NO ONE.

 

 

 

[Acemundo]

actually I have no issue with pr being allowed to take their proceeds of hdb flat sales. if don't allow, it is creating an awkward system whereby the transaction is allowed but the proceeds to the transaction have to be encumbered.

 

the real problem is the ease of PR buying and selling hdb........

Edited June 18, 2014 by Acemundo

[Mustank]

actually I have no issue with pr being allowed to take their proceeds of hdb flat sales. if don't allow, it is creating an awkward system whereby the transaction is allowed but the proceeds to the transaction have to be encumbered.

 

the real problem is the ease of PR buying and selling hdb........

 

only those served ns should be allowed to buy hdb

[Scion]

actually I have no issue with pr being allowed to take their proceeds of hdb flat sales. if don't allow, it is creating an awkward system.

 

the real problem is the ease of PR buying and selling hdb.

 

 

agreed

 

should implement a rule instead that a PR must convert to citizenship within 5 years, or he/she must say bye bye and sell away whatever flats he has in Singapore

[Xanavi]

I wonder what will Singaporeans who are PRs oversea feel if their government do the same

Edited June 18, 2014 by Xanavi

[Jman888]

 

 

agreed

 

should implement a rule instead that a PR must convert to citizenship within 5 years, or he/she must say bye bye and sell away whatever flats he has in Singapore

 

 

as if so easy to convert, if cannot convert must leave singapore?

[TVT]

 

Yah • 15 hours agoReport Abuse

 

Singapore belongs to everyone.

 

Do not be selfish.

 

If he says "Singapore belongs to everyone", then everyone should do NS, isn't it ?

[Acemundo]

I wonder if Singaporeans who are PRs oversea will feel if their government do the same.

I think the chances of this happening to singaporeans who are pr overseas will be very low. why?

 

because public flats of such numbers are not common in other countries. even their citizens most times have to buy private houses or flats. their citizens that owns such public flats are very poor . surely our PR singaporeans are not going to qualify to buy their public flat.

[Scion]

 

 

as if so easy to convert, if cannot convert must leave singapore?

 

 

that's the part i don't understand

 

very often i hear that someone's PR wife cannot get citizenship (some can't even get PR), even when they have children here

 

why those who are committed to Singapore cannot get citizenship, while those who leech get all the benefits and privileges

 

is the economic value of an individual so important to our govt, that his/her loyalty and commitment come second?

[Vid]

 

If he says "Singapore belongs to everyone", then everyone should do NS, isn't it ?

 

We are the "privileged" few who can do NS [:/]

[Sabian]

 

 

as if so easy to convert, if cannot convert must leave singapore?

 

I think he meant say bye bye to the HDB flat as in sell the HDB flat.

[Tigerwoods]

actually I have no issue with pr being allowed to take their proceeds of hdb flat sales. if don't allow, it is creating an awkward system whereby the transaction is allowed but the proceeds to the transaction have to be encumbered.

 

the real problem is the ease of PR buying and selling hdb........

The problem is created when Govt allow PRs to buy HDB resale flat.

Which country in the world allow public flats to change hands from citizen to PR ? or maybe I noob.

PRs or any foreigner should only touch Pte property period.

 

Foreigners and PRs can onlyBuy Brand new Pte Property (leasehold, with a substantial govt tax compounded on it) and if they want to sell, sell only to Citizens.

 

If we citizens are Sake Zui one, squeeze them on prices.

But no, they come and go so easily, profiting from our extremely generous policies, sometimes I find the only restriction to them is at the Changi Airport Customs...

 

only those served ns should be allowed to buy hdb

What if the guy exempted from NS due to health issues ? and got married ?

You very chek ark one..

Edited June 18, 2014 by Tigerwoods

[Albeniz]

Really feel like taking bus 170 and buy 1 unit of public housing in JB.

 

Does their policy allow? It will be good news.

[Myxilplix]

is the economic value of an individual so important to our govt, that his/her loyalty and commitment come second?

 

Yes, obviously.

[Jman888]

I think the chances of this happening to singaporeans who are pr overseas will be very low. why?

 

because public flats of such numbers are not common in other countries. even their citizens most times have to buy private houses or flats. their citizens that owns such public flats are very poor . surely our PR singaporeans are not going to qualify to buy their public flat.

 

 

the different is no other country like singapore where public housing occupy 70%-80% of the property market, most countries dun even have public housing, hence the norm of the public housing (hence its pricing) is as good as what one can get from the market.

 

 

[Mockngbrd]

who u all voted for?

[Acemundo]

The problem is created when Govt allow PRs to buy HDB resale flat.

Which country in the world allow public flats to change hands from citizen to PR ? or maybe I noob.

PRs or any foreigner should only touch Pte property period.

 

Foreigners and PRs has to be Buy Brand new Pte Property (leasehold, with a substantial govt tax compounded on it) and if they want to sell, sell only to Citizens.

 

If we citizens are Sake Zui one, squeeze them on prices.

But no, they come and go so easily, profiting from our extremely generous policies, sometimes I find the only restriction to them is at the Changi Airport Customs...

precisely......PRs may have it easier than some singaporeans in buying and selling hdb.

 

as I said in latter post, public house is a rare commodity in other country so they have very little need to legislate against unrestricted buying and selling by PR. we are first in the world when comes to providing so many subsidised public flat yet our legislation and administration towards the public flats are found wanting.

[TVT]

 

We are the "privileged" few who can do NS [:/]

 

Yup. Lets book-in to Guillemard Camp tomorrow for our "ICT"......