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Long-stalled land tax bill back in discussion

By on Jun 07, 2012 in Property News

Undeveloped plots to attract a penalty rate

The Finance Ministry is vowing to push forward the land tax bill, stalled for a decade, and may increase the tax ceiling, says the Fiscal Policy Office (FPO).

Somchai: Raise rates to benefit the country

Director-general Somchai Sujjapongse said the FPO is now amending details of the draft. Once the amendment version is completed, it will arrange a public hearing.

The major amendment is the tax ceiling rate.

Under the current draft there are three tax rates depending on the purpose of land usage.

Land and buildings set aside for commercial use are subject to an annual assessment of not more than 0.5% of the value of the land, residential land and buildings will be taxed a maximum of 0.1% and farmland is taxed not more than 0.05% of annual valuation prices.

There are penalties for owners of undeveloped land.

“We are considering increasing the ceiling above 0.5% to benefit the country,” said Dr Somchai.

Landlords with undeveloped land plots would be subject to tax rates that double every three years, up to a maximum charge of 2% of the land value per year, a fee aimed at encouraging greater efficiency in land use.

Dr Somchai added even though tax ceiling rates may be increased, these are maximum rates, and it is up to the local communities to determine the actual tax rate.

It plans to amend the land tax exemption for low-income earners, which shields most of the poor from significant tax burdens.

Under the existing draft, an owner of a condominium unit with a maximum space of 50 square meters is subject to a tax exemption.

Houses on plots less than 50 square wah in size and valued 1 million baht or less receive the same exemption.

Because land prices in large cities far exceed those in rural areas, it will amend the draft land tax bill to allow tax exemption for houses with total value of less than 1 million baht regardless of the size.

Source : Bangkok Post 1 June 2012

Nora has been in the Corporate Communications arena for a number of years. Nora's role is to communicate all newsworthy items that are of a PR nature.

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