Thailand
Thailand: Rental cut for state lands proposed
The Treasury Department has proposed a 50% reduction in rental fees for state lands used for commercial purposes by businesses to reduce operators’ financial burdens and help maintain the employment rate.
Details of the rental reduction are being deliberated, along with conditions for renters, said director-general Yuttana Yimgarund.
For instance, business operators would have to accept a condition to retain existing employees if a 50% reduction in rental fees is applied.
The Treasury Department leases out the most land in the country, covering lands used for housing, agriculture and commercial purposes. Commercial land is leased to large businesses, such as airports and energy, as well as small businesses.
The proposed measure is in line with the government’s policy to support the private sector’s job retention while the economy is hampered by the pandemic, said Mr Yuttana.
Reducing rental fees is beneficial and uses a small amount of financial resources compared with cases where many employees are laid off, which requires greater financial aid from the government, he said.
Previously the department allowed lessees of state lands used for commercial purposes to postpone rental payment for a year to offset falling revenues.
Although the department has applied leniency in rental payments through postponement, the fallout from the outbreak continues to affect businesses, hence the latest measure to implement a 50% reduction in rental fees of state lands used for commercial purposes.
For state lands used for housing and agriculture, the department has waived the rental fees for a year and further leniency could be applied if the situation continues to affect renters.
The department has a total rental income from state lands of 8 billion baht per year.
Some 75% comes from commercial rental income and 25% is from agricultural and residential rents.
While loosening rental rates will affect this year’s annual revenue, the department projects total revenue of 10 billion baht, up from the target of 8.7 billion, attributed to new rental spaces, write-offs on lands the department acquired by legal means and accelerating the opening of land auctions in special economic zones and large commercial lands, said Mr Yuttana.
Source: https://www.bangkokpost.com/business/1932712/rental-cut-for-state-lands-proposed