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Hong Kong's New Property Market Tax Reforms
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On February 28, 2024, the Hong Kong government introduced a series of measures to 'rescue the property market,' abolishing several 'spicy taxes.' One of the most significant changes is that regardless of whether it is a first-time purchase, all buyers now only need to pay the Ad Valorem Stamp Duty (AVD). In the latest 2025 budget, the government announced that for properties valued below 4 million, the stamp duty will be uniformly reduced to $100.
🔹 Overview of Government Measures
- No distinction between first-time and non-first-time buyers: The distinction between 'first-time' and 'non-first-time' stamp duties has been abolished. All buyers, regardless of whether they are purchasing for the first time, will now pay the Ad Valorem Stamp Duty at the second standard rate. This not only reduces the financial burden on buyers but also enhances market liquidity.
- Complete abolition of spicy measures in 2024: The previous 'Buyer's Stamp Duty (BSD)' and 'New Residential Stamp Duty (NRSD)' have been completely abolished. Currently, only the standard Ad Valorem Stamp Duty (AVD) is required in the market, with no additional burdens.
- In 2025, the $100 stamp duty will apply to properties valued at 4 million or below: For properties priced below 4 million, the Ad Valorem Stamp Duty will be uniformly reduced to $100, making it highly attractive to first-time buyers and those in the secondary market.
🔵 Specific Changes and Tax Rate Details
1. Standard Ad Valorem Stamp Duty (AVD)
- Under the previous harsh measures policy, there was a significant difference in stamp duty between first-time home buyers and non-first-time buyers. Now, whether it's a first-time purchase or not, the same second standard tax rate applies.
- Ad valorem stamp duty is currently graded according to the property price, and the standard ad valorem stamp duty rates include the following:
| Property Price (HKD) | Second Standard Rate (HKD) |
|---|---|
| 4,000,000 or below | 100 |
| > 4,000,000 to 4,323,780 | 100 + 20% of the amount exceeding 4,000,000 HKD |
| > 4,323,780 to 4,500,000 | 1.5% |
| > 4,500,000 to 4,935,480 | 67,500 + 10% of the amount exceeding 4,500,000 HKD |
| > 4,935,480 to 6,000,000 | 2.25% |
| > 6,000,000 to 6,642,860 | 135,000 + 10% of the amount exceeding 6,000,000 HKD |
| > 6,642,860 to 9,000,000 | 3.00% |
| > 9,000,000 to 10,080,000 | 270,000 + 10% of the amount exceeding 9,000,000 HKD |
| > 10,080,000 to 20,000,000 | 3.75% |
| > 20,000,000 to 21,739,120 | 750,000 + 10% of the amount exceeding 20,000,000 HKD |
| > 21,739,120 or above | 4.25% |
All residential buyers are subject to the same second standard tax rate, and the stamp duty for properties under HK$4 million has been reduced to HK$100, significantly lowering the cost for first-time homebuyers.Want to learn more about LetsGetHome homebuying tips?
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