Singapore Slightly Reduces Development Charge Rates For Commercial Use
SINGAPORE – The development charge (DC) rates for commercial use from 1 September 2021 to 28 February 2022 have been trimmed, according to a press release published by the Ministry of National Development (MND) on Tuesday afternoon (31 August, SGT).
On average, the DC rates for Use Group A (Commercial) was trimmed by 0.7 percent. While that for 79 out of 118 geographical sectors were unchanged, the 39 remaining geographical sectors saw a reduction ranging from 1 percent to 3 percent.
The largest drop of 3 percent was implemented in Sector 23, Sectors 40 to 43, Sectors 60 to 62, Sector 67, Sector 80, Sector 88, Sector 94, Sector 98, Sectors 100 to 105, Sector 110, and Sector 112. The specific locations covered by each sector is listed below:
• Sector 23 (Oxley Rise/ Oxley Road/ Penang Road/ Orchard Road/ Dhoby Ghaut/ Prinsep Street/ Handy Road/ Fort Canning Road)
i. Sectors 40, 41, 42, 43 (Mount Elizabeth/ Somerset/ Orchard Area)
ii. Sectors 60, 61, 62 (Novena Area)
iii. Sector 67 (Cluny Road/ Napier Road/ Tanglin Road/ Anderson Road/ Stevens Road/ Dalvey Road)
iv. Sector 80 (Lower Delta Road/ Jalan Bukit Ho Swee/ Bukit Ho Swee Link/ Kim Tian Road/ Jalan Bukit Merah)
v. Sector 88 (Mount Faber/ West Coast Highway/ Keppel Bay/ Labrador Nature Reserve)
vi. Sector 94 (Tanjong Katong Road South/ Amber Road/ Mountbatten Road/ East Coast Road/ Joo Chiat Road/ vii. Marine Parade Road/ East Coast Parkway)
viii. Sector 98 (Kaki Bukit/ Bedok/ Xilin Avenue/ Simei/ Changi South Area)
ix. Sectors 100, 101, 103, 104, 105 (Punggol/ Hougang/ Paya Lebar/ Bartley/ Toa Payoh/ Serangoon/ Ang Mo Kio Area)
x. Sector 110 (Commonwealth Avenue West/ Holland Avenue/ Holland Road/ Ulu Pandan Road/ Clementi Road)
xi. Sector 112 (Pan Island Expressway/ Bukit Batok East Avenue 6/ Upper Bukit Timah Road/ Clementi Road/ West Coast Highway/ Penjuru Road/ Jalan Buroh/ Jurong East Area)
Notably, the authorities have reduced the DC rates for commercial use for the 3rd straight time.
Leonard Tay, Knight Frank’s Research Head in Singapore noted that some commercial properties continue to struggle as the retail segment has not fully recovered from COVID-related curbs.
“The Orchard areas of Sectors 40, 41, 42, and 43 will see DC rates falling between 2.5 per cent and 3.4 per cent, due to the continued impact on tourist spending in Singapore’s prime shopping belt,” he added.
The development charge is a tax that is imposed when planning permission is granted to carry out projects that increase the land’s value. For example, a development is rezoned to a higher value use, or its plot ratio is increased.
The DC rates are reviewed every 6 months on 1 March and 1 September.
