The Penang government has denied claims in the media today that the state saw the highest cost of living which corresponded with the increase of property and land-related taxes since it took over from BN in 2008.

"The report is slanted and did not consider the measures taken by the Penang government to lower cost of living, including providing enough affordable housing for Penangites," state exco on housing Jagdeep Singh Deo told Malaysiakini, when contacted.

In The Sun Daily today, Harvard and Wharton-trained political economist Isham Jalil said the rise in such taxes has increased the cost of houses and business premises, and in turn increased the cost of goods and services. 

Isham, who served nine years in the Economic Planning Unit under the Prime Minister's Department, added that this situation reduced the net disposal income of the Selangor and Penang people.

In terms of affordable housing, Jagdeep said the Penang government has "outperformed" the previous administration led by BN.

He said from 2008 to 2017, some 24,000 units had been delivered as opposed to the same period of 1999 to 2007 under BN, where only 5,100 units were delivered.

Jagdeep denied that prices of housing in Penang are "out of control", adding that property prices in the state had seen the highest reduction in the country. 

"However, for affordable housing units, the state government had capped the prices and provided enough stock for Penangites," he noted.

"Apart from the 24,000 units, 17,000 are currently being built, and are priced at RM42,000 to RM300,00. Another 32,000 units of such price brackets are being approved by the state government.

"This brings the total to more than 70,000 units, ranging from RM42,000 to RM300,000 of affordable housing in Penang."

Jagdeep said it is wrong for the political economist to make a general statement about the burden of the cost being passed on to house buyers.

Isham said in Penang, the development charge - previously RM5 per sq ft for residential units and RM7psf for commercial units before 2008 - trippled to RM15psf and RM21psf respectively after 2008.

Jagdeep said the state government had addressed the issue of high land premiums by coming up with guidelines which gave incentives to the developer for development of affordable housing.

The developers who build 100 percent affordable homes are charged only RM5psf, he added.

Developers who built units with price ranging from RM150,000 to RM300,000 are exempted totally from building low (RM42,000) and low-medium (RM72,500) cost units.

"We know as this is one of the main complaints we received from the developers as well," Jagdeep said.

'People taxed higher compared to BN time'

In The Sun Daily report, Isham also wrote that the significant increase in property tax revenues collected by the Selangor and Penang governments "come out of the pockets" of the people who are taxed 10 to 20 times higher now compared to BN time.

Jagdeep challenged the federal government to show if there is even one unit of affordable housing built by federal-led PR1MA Housing in Penang.

"Maybe they are planning or already started but there had been no application for planning permission from the state," Jagdeep said.

He said at the end of the day, buyers cannot afford to purchase affordable housing as 70 percent of applications for loans are rejected by Bank Negara.

"We cannot address this issue at the state level as Bank Negara is under the purview of the federal government," Jagdeep said.

"We have fulfilled the first part, which is to provide enough stock for the people, but at the end of the day, it depends on whether their loan application can be approved. We may impose increased charges on developers but it all goes back to the people in terms of affordable housing projects.

"There is no point being king of affordable housing when people cannot buy the units due to loan restrictions."

Jagdeep recalled that BN assemblypersons also agreed to this problem and have signed a joint motion to urge Putrajaya to step in to address the issue.

"What has happened now? It's been almost two years already, we have not even be called for a meeting when we have sent letters to request for one."