ESTATE DUTY (Remission for sole family house)

Mr J. F. Conceicao asked the Minister for Finance if he will consider introducing amending legislation to remit estate duty on a house which is the only one owned by the deceased, if the house is continued to be occupied by the family of the deceased.

The Minister for Finance (Mr Hon Sui Sen): Mr Speaker, Sir, the hon. Member may remember that before 8th March, 1972, the exemption under the Estate Duty Act was up to $10,000. In my Budget statement for the year 1972-73, one of the tax concessions I announced was a remission from estate duty for estates worth up to $25,000. I am not inclined at present to consider any further concession.

The Member for Katong's suggestion to amend the legislation to remit estate duty on a family house would result in an unnecessary sacrifice of revenue in the case of the wealthy. For example, if, as has occurred, a family house left by a deceased multi-millionaire is worth $8 million, the remission of the estate duty on such a family house would be $5 million. I consider also that it would not be desirable to give remission other than within the limit I have set, on a sole family house specifically in distinction to savings in different forms, such as insurance policies, deposits in banks, Post Office Savings Bank, Government bonds, shares, etc.

Mr Conceicao: Mr Speaker, Sir, does the Minister realise that with the present escalation of prices of properties, the estate duty may well result in bankrupting a family concerned which owns one house, which might have been purchased around $20,000 or $40,000 but is now valued at about $200,000? The family may have to sell the house in order to pay estate duty and fritter away the rest of the money in rentals until they get a Housing Board flat.

Mr Hon Sui Sen: Mr Speaker, Sir, I realise the consequence to someone leaving $200,000 to his family. But I would expect anyone who has such a valuable house to take the usual precaution of transferring the house during his lifetime to his beloved ones.

Mr Conceicao: Sir, under such circumstances, can the Minister inform the House whether steps would be taken to maintain or stabilise the present level of prices of property, or even perhaps reduce them, so that the prices will not escalate further and thereby expose prospective inheritors of estates to this problem of having to pay very high estate duty and facing the possibility of losing the sole family property?

Mr Speaker: It is a long question, Mr Conceicao.

Mr Hon Sui Sen: Sir, if the Member is speaking for the person who owns the house, the suggestion to implement measures to restrict the increase in the value of the property would be unappreciated by this owner.