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Land Tax in Thailand – Higher Tax on Unused Land Eyed

By on Oct 28, 2013 in Property News

Higher Tax on Unused Land EyedGoal is to discourage price speculation. The Finance Ministry has pitched the idea of adjusting the tax on unused land to more than 0.5%, up from not more than 0.5% in the current draft,to discourage land speculation.

Somchai Sujjapongse, director general of the Fiscal Policy Office (FPO), said it is an initiative by Deputy Prime Minister and Finance Minister Kittiratt Na-Ranong, who intends to tax unused land only.

“We have been assigned to conduct a feasibility study on whether this tax is possible and if we need a new law to apply it,” he said.

A tax on unused land has been floating around in Thai politics for two decades and was part of a Democrat Party land and building tax bill offered during the last administration.

Under the draft, the tax rate for undeveloped land will not exceed 0.5% of the appraised value for the first three years after passage of the law but can double later, although never exceeding 2% of its value.

The new proposal is for unused land to be taxed at more than 0.5%,but the final rate is undecided.

“In a bid to make sure the tax rate is efficient, we believe the current rate is not high enough to discourage speculators,” said Mr. Somchai.

Mr. Kittiratt did not consider other land tax categories in the draft such as land and buildings for commercial use (proposed at up to 0.5% of the appraised value), land for agricultural purposes (0.05%) and private residences (0.5%).

Mr. Somchai said initially the definition of unused or undeveloped land will be land where less than half the plot is used.

The FPO will discuss an appropriate rate with property developers,academics and local administrations before deciding on a tax for unused land.

For the full article,please visit http://www.bangkokpost.com/business/news/375907/higher-tax-on-unused-land-eyed

Source | Bangkok Post 23 October 2013

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