The land and building tax law may not come into force early next year as earlier scheduled but this will not impact on the state coffers because the tax collected will go to local administrative bodies, said Deputy Finance Minister Visut Srisuphan on Friday.
The bill, he added, is now pending the consideration of the Council of State and is expected to be tabled to the cabinet this month before it is forwarded to the National Legislative Assembly for debates which will take between 4-5 months for the bill to become law.
The deputy finance minister said that even if the promulgation of the law is delayed, it will not impact on the state coffers because the land and building taxes to be collected under this proposed law will go to the coffers of local administrative bodies for local development.
Currently, land and building taxes collected amount to 30 billion baht a year and the amount is estimated to double after the promulgation of the new law which is aimed to discourage land speculation and to encourage the utilization of empty land.
Under the proposed land, land is classified into four types in accordance with their usages and taxes are levied accordingly.
Land for agriculture is to be taxed at 0.2 percent for land plots worth more than 50 million baht/plot. As for land for residential purpose, the first house which is worth less than 50 million baht will exempted from taxation, but for the second home, tax will be collected on progressive rate.
The ceiling tax rate for land for commercial use is 2 percent for land worth no more than 20 million baht, but the actual rate to be charged is 0.3 percent, 0.5 percent for land worth 20-50 million baht, 0.7 percent for land worth 50-100 million baht, 0.9 percent for land worth 100-1,000 million baht, 1.2 percent for land worth 1,000-3,000 million baht; and 1.5 percent for land worth more than 3,000 million baht.
Unutilized land is taxed a maximum of 5 percent, but tax rates vary in accordance with the duration of the land being unused: 1 percent for land left unused for 1-3 years; 2 percent for land left unused 4-6 years and 3 percent for land left unused for seven years and more.