Revision of Penang quit rent justified, says CM
Chow Kon Yeow pointed out that the last review was in 1994
PENANG Chief Minister Chow Kon Yeow has defended the move by the state to revise the quit rent structure upwards despite critics and his predecessor, Lim Guan Eng, having exclaimed that the hike was unreasonably high.
Both the Penang Ratepayers Association and Lim have quantified the increase as more than 200 per cent for some parcel landowners, but Chow stressed that Penang was among the last states in the country to review the quit rent rates under Section 101 of the National Land Code (Act 828).
The last review was in 1994, Chow pointed out in a statement.
Secondly, the gazetting of 16 localities as townships was done in 1966, almost 60 years ago - the state recently added several more to qualify as townships.
There are now 25 localities defined as townships under the land code.
Due to the long lull period over the gazetting of areas as townships, the quit rent structure for landowners in town and county areas was uneven.
This resulted in a huge gap in rates between township and semi-rural areas.
So, the state is of the view that it is only fair that landowners pay for proper assessed market rates for ratepayers living in land defined as a town or county.
Due to the sudden hike in rates, the state empathised with the landowners, hence there is a move to offer a 50 percent rebate for some landowners if their appeals are seen as valid, said Chow.
"The land administrators in each district are now reviewing some 360 appeals from landowners," said Chow.
In the past 30 years, Chow said that Penang landowners were enjoying relatively low quit rent charges compared to those who were paying rates based on the current use calculations.
The mechanism to offer rebates is enshrined under the Penang Land Rules 2021, so it is legislated, said Chow.
"The rebates are therefore clear, transparent and fair to the landowners," said Chow.
Penang is implementing a major quit rent increase (land tax) starting January 1, 2026, with hikes between 29 per cent and 200 per cent across various land categories, stating that the last assessment was done over three decades ago.
The hike in quit rent was also necessitated, as the state seeks more revenue to compensate for the huge investments the state is undertaking for an upgrade in infrastructure, from new bypass highway roads to new social amenities.
There are rebates of up to 50 per cent offered, and over 370,000 landowners in Penang are affected by the revision of quit rent rates.
Landowners are allowed to appeal, especially for First Grade land.
The new rates follow the gazetting of 10 expanded and 25 new townships. - Feb 20, 2026.
