Landlords to fund appraisals
Landlords of large commercial buildings and manufacturing plants must shoulder the fee for the appraisal of their land and building value, which will be used to compute land and buildings tax bills.
They must hire advisers accredited by the Securities and Exchange Commission for assessments, said Chakkrit Parapantakul, the outgoing director-general of the Treasury Department.
A draft bill on the land and buildings tax, expected to be enforced on Jan 1 next year, is now under a second reading with the National Legislative Assembly.
State enterprises that have industrial plants or commercial operations will be liable for the new property tax, Mr Chakkrit said.
The draft bill calls for the tax to be levied on first-home owners and farmland appraised at 50 million baht and higher. A tax rate of 0.05% will be applied to first homes and agricultural land worth between 50 million and 100 million baht, and a 0.1% rate for homes above 100 million.
People owning second homes will be taxed in a range of 0.03-0.1% of the appraisal price, depending on the value of the property.
The tax on vacant land will rise by 0.5 percentage points every three years, up to a cap of 5%, while land for commercial and industrial use will be levied at 0.3-1.5%.
The land and buildings tax, which will replace the outdated house and land tax and the local development tax, is aimed at narrowing income disparity, expanding the national taxpayer base, increasing tax income for local administrations and improving land use.
Mr Chakkrit said landlords who want to reduce their tax burden should separate land plots and transfer them to others or juristic entities, as juristic persons can exploit tax breaks. Those who own undeveloped land should plan to use it to prevent higher tax rates, he said.
Mr Chakkrit said the department has appraised 18.6 million plots in 24 provinces, leaving 13.4 million plots unappraised. Assessment is expected to be finished by year-end.
To help bring about the new tax, the department is replacing appraisal prices for block areas with land parcels to make property tax evaluation fairer.