New Thailand Land and Building Tax Sets In

The start of 2020 brings a new tax with it. While the Thailand Land and Building Tax B.E. 2562 came into effect on 13 March 2019, payment was not due until 1 January 2020.

This act replaced the archaic House and Land Tax B.E. 2475 dated 1932 and was implemented to improve and encourage land use, enable more efficient tax collection, increase public revenue and reduce income disparity.

Additionally, the new act replaces other legislation effectively consolidating the previous tax system. These include the Land Development Tax B.E. 2508 (1965), the Notification of the National Executive Council No. 156 BE 2515 (1972) and the Royal Decree Designating the Medium Price of Land for Land Development Tax Assessment B.E. 2529 (1986).

The tax applies to any individual or company that has ownership or rights over land or buildings that includes condominium units. These three property types are defined as land including hills and waterways, buildings such as houses, boathouses or other structures that are habitable, and industrial and commercial storage units. Condominium units are those where the title is assigned under the condominium act.

This mandatory tax is due at the local district office by April of each year and is calculated by the official assessed price. This figure is set out by the government.

The notable change to this new tax is that it is a progressive rate calculated on property usage replacing the previous flat rate of 12.5 percent.

It also applies to residential properties that were once exempt. However, exemptions from the Thailand Land and Building Tax include first time buyers of homes and land where the value is less than THB 50 million and the owner is listed on the house registration book, and owners of homes valued less than THB 10 million who are listed on the house registration book.