Penang’s new land tax system, effective 2026, ends 30-year-old rates and ensures equitable treatment for all landowners, with state support measures in place.

GEORGE TOWN: Penang’s revised land tax formula treats all landowners fairly and equitably, Chief Minister Chow Kon Yeow said.

The new system eliminates discrimination between First Grade and non-First Grade landowners after rates went unreviewed for over 30 years.

Chow explained that tax rates now reflect a site’s current land use as per gazetted categories.

“For a residential site, tax is calculated by multiplying the land area by the residential tax rate,” he said at his Komtar office.

This rate is RM0.70 per square metre for urban land and RM0.50 per square metre for rural land.

The state government has issued nearly 370,000 land tax bills under the revision effective from January 1.

Only 300 appeals have been received by the Penang State Land and Mines Office to date.

Taxpayers are encouraged to submit appeals should any issues arise with their assessments.

Chow expressed regret over parties sensationalising the increase without understanding the calculation.

He said the state has implemented measures to help landowners adapt to the new rates.

These include rebates of up to 50%, a 100% exemption on late payment penalties, and a more flexible appeal mechanism.

The revision and reclassification of rural to urban land was done under Section 101 of the National Land Code.

 The Sun Malaysia