The draft bill for the new land and buildings tax remains on track to pass in the next 2 months, which would allow it to take effect on 1st January 2019 as expected, according to media reports. At the moment, a standing committee at the National Legislative Assembly (NLA) is now vetting the bill.
The bill was passed during its first reading at a recent session and now the committee will hold a second public hearing on the tax, says. NLA Finance Minister Apisak Tantivorawong to the Bangkok Post.
The NLA standing committee has made some adjustments to the original proposal including reducing the exemption ceiling for 1st homes from THB50 million to THB20 million. The former figure was introduced by the Finance Ministry and has been a source of debate for many months. According to estimates from the Finance Ministry, cutting the exemption ceiling for 1st homes to THB20 million will increase the number of homes subject to the land and buildings tax 3 fold.
Should it receive approval, the new tax will replace the house and land tax and the local development tax. It is predicted to generate as much as THB64.2 billion for local administrative organisations, which would be a significant increase of the THB25.9 billion raised by the current tax structure.
The draft bill has been amended several times in order to appease those who will be affected by the new property tax. Details of the draft bill have yet to be fully released, but will be clearer after the 2nd public hearing is finished. Among the details already announced was a relief measure that will lessen the impact of the new tax on businesses.
As part of the new taxes, landlords will be subject to higher tax payments. The current tax is based on land appraisal prices made 40 years ago, but the new tax is going to use the current land appraisal price.