New Thai land and house taxes expected to be finalised and submitted this month
Finance Minister Sommai Phasi said that the the new Thai tax decision on the minimum value of property to be taxed and the values of real estate to be exempt from tax was yet to be finalised. Finance permanent secretary Mr Rangsan Sriworasart also said that Deputy Prime Minister Pridiyathorn Devakula had shown his support for the idea of imposing new Thai taxes on land and houses.
Where the ministry stands currently on tax rates is a land plot that has a house on that land which is worth less than one million baht will be exempt from tax. A house and land plot worth between 1-2 million baht will be taxed half of the proposed tax rate where a house and land plot which is worth more than three million baht will be taxed the full amount of the proposed tax rate. These rates have not yet been finalised but the cabinet is rumoured to be in favour.
Three tax rates have been proposed: 0.5 percent for farming land and for residential purposes but in the initial period land for residential purpose will be taxed at just 0.01 percent, the period of time for the initial period is unknown at this moment. The proposed tax rate for commercial land use is 2 percent where the highest tax rate is for unused land at 4 percent. The owners of unused land will not be hit with the tax straight away, they will be given three years to put the land to use or be taxed at the nominal rate.
This new tax is aimed at re-filling the countries coffers although some areas of Thailand’s real estate market have already been cooling in recent months and many predict that new tax’s could turn potential overseas buyers away from the Thai property market.