Penang: The Penang government has announced the standardization of quit rent payments for all school land in the state, setting it at a nominal rate of RM50 per title, effective immediately.

According to BERNAMA News Agency, Chief Minister Chow Kon Yeow clarified that the decision aims to establish a uniform payment rate across schools, ensuring they are charged equally without increasing their financial burden. Before the 2026 tax revision, school land was taxed at a building rate. However, following the revision, land owned by the Federal Land Commissioner will now incur a nominal tax of RM50 per title, affecting 106 titles. Similarly, school land not owned by the Federal Land Commissioner will also face the same nominal tax, involving 201 titles. International schools, however, are exempt as they fall under the business category and are taxed accordingly.

Chow highlighted that some schools previously faced quit rent payments amounting to several thousand ringgit. With the new standardization, they will only pay RM50 per title, reducing their financial strain. In parallel, a comprehensive review of quit rent rates over the past 30 years revealed higher rates for some landowners, particularly those with 'First Grade' land.

The review, based on current land use and outlined in the Penang State Government Gazette dated September 11, 2025, found that many 'First Grade' parcels were taxed at agricultural rates despite being used for residential, commercial, or industrial purposes. Chow provided an example of a First Grade land parcel in Seberang Perai Selatan, initially taxed at RM33 per year under the agricultural category. Once verified for industrial use, the tax now amounts to RM35,101 annually, reflecting the standard industrial rate of RM3.25 per square metre.

Chow acknowledged the significant increase but emphasized its fairness and equity in ensuring all industrial landowners in Penang pay the appropriate rate. To mitigate the impact on landowners, the state government has approved a 50 percent quit rent rebate for 2026, subject to minimum rate conditions.