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Thailand: Land tax law’s date uncertain
The Finance Ministry says it will push the draft bill on the land and buildings tax for lawmaker approval during the Prayut Chan-o-cha government, but the law’s enforcement may be delayed from the scheduled start at the beginning of 2019.
Whether or not the law’s enforcement will be pushed back will depend on the readiness of local administrative organisation officials, Deputy Finance Minister Wisudhi Srisuphan said, adding that recent rehearsals of practice guidelines have found that most officials are not ready for the new tax collection methods.
“We insist on pushing for the law’s passage within this government’s regime,” Mr Wisudhi said. “The vetting is prolonged because the law is new, involves many parties and needs time for cautious consideration. However, we confirm that almost all low-income earners won’t feel any impact, as the tax exempts land valued within 50 million baht.”
Implementation of the land and buildings tax was delayed further when the National Legislative Assembly (NLA) standing committee extended the scrutiny process for the eighth time, lapsing at the end of September.
The draft bill on the land and buildings tax has been stuck in the scrutiny process since passing a first reading in March 2017.
The NLA panel earlier watered down the new property tax rates proposed by the Finance Ministry. The committee agreed to a ceiling tax rate for homes of 0.3%, down from 0.5% proposed by the Finance Ministry; an agricultural use rate of 0.15%, down from 0.2%; and a rate for other used and undeveloped land of 1.2%, down from 2%.
Moreover, the committee recently agreed to reinstate the Finance Ministry’s proposal for the first-home exemption threshold of 50 million baht, from 20 million previously. If the latest proposal goes into effect, owners of first homes appraised at 50-75 million baht will be required to pay a property tax rate of 0.03%, or 300 baht for every million baht that exceeds the exemption threshold, 0.05% for homes appraised at 75-100 million, and 0.1% for houses appraised at more than 100 million.
Second homes will be taxed at 0.02% for property with appraisal values of up to 50 million baht, 0.03% for 50-75 million, 0.05% for 75-100 million and 0.1% for more than 100 million.
Regarding local media reports that the government is considering whether to permanently cut the 2% ownership transfer fee and 1% mortgage fee to 0.01% of the appraisal price, Mr Wisudhi said the Finance Ministry is ready to mull the Interior Ministry’s proposal.
He said he personally believes that the property sector’s growth is healthy and that the trend will continue.
Source: https://www.bangkokpost.com/business/news/1523142/land-tax-laws-date-uncertain