TRENDS OF PROPERTY TAX IN MALAYSIA
WHAT IS PROPERT TAX : Property or Assessment Tax is levied on all property holdings, including shops, factories, residential, agricultural and others, situated in the areas under the jurisdiction of local authorities.
HISTORY OF PROPERTY TAX
The history of property tax is begun at United States of America. Taxes based on ownership of property were used in ancient times, but the modern tax has roots in feudal obligations owned to British and European kings or landlords. In the fourteenth and fifteenth century, British tax assessors used ownership or occupancy of property to estimate a taxpayer’s ability to pay. In time the tax came to be regarded as a tax on the property itself. In the United Kingdom the tax developed into a system of rates based on the annual (rental) value of property. The growth of the property tax in America was closely related to economic and political conditions on the frontier. In pre-commercial agricultural areas the property tax was a feasible source of local government revenue and equal taxation of wealth was consistent with the prevailing equalitarian ideology. When the Revolutionary War began, the colonies had well-developed tax systems that made a war against the world’s leading military power thinkable. The tax structure varied from colony to colony, but five kinds of taxes were widely used. Capitation (poll) taxes were levied at a fixed rate on all adult males and sometimes on slaves. Property taxes were usually specific taxes levied at fixed rates on enumerated items, but sometimes items were taxed according to value. Faculty taxes were levied on the faculty or earning capacity of persons following certain trades or having certain skills. Tariffs (imposts) were levied on goods imported or exported and excises were levied on consumption goods, especially liquor.
During the war colonial tax rates increased several fold and taxation became a matter of heated debate and some violence. Settlers far from markets complained that taxing land on a per-acre basis was unfair and demanded that property taxation be based on value. In the southern colonies light land taxes and heavy poll taxes favored wealthy landowners. In some cases, changes in the tax system caused the wealthy to complain. In New York wealthy leaders saw the excess profits tax, which had been levied on war profits, as a dangerous example of leveling tendencies. Owners of intangible property in New Jersey saw the tax on intangible property in a similar light. By the end of the war, it was obvious that the concept of equality so eloquently stated in the Declaration of Independence had far-reaching implications. Wealthy leaders and ordinary men pondered the meaning of equality and asked its implications for taxation. The leaders often saw little connection among independence, political equality, and the tax system, but many ordinary men saw an opportunity to demand changes.
The property tax is a compulsory contribution to be paid by the taxpayer, where the taxpayer in return will receive benefits from the local authorities in the form of tangible and intangible services, community facilities, infrastructures and development projects for their enjoyment . In the context of property tax, enforcement of the tax is intended as a tool to drive the development of areas administered by local authorities. Property tax imposed on the taxpayer is given back by local authorities in the form of services in their respective administrative areas. The imposition of property tax is related to the role of local authorities in developing the area and providing the necessary services and facilities. According to Section 127 to section 163 of the Local Government Act 1976, local authorities are empowered to impose property tax on property owners to carry out the functions and roles of local authorities as an organization which has autonomy over the local populace. The local authorities...
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