Now or never for unpopular land tax

[webfact]

Now or never for unpopular land tax

By The Nation

 

 

With so many property owners among legislators, this necessary bill could be doomed after the election

 

Enactment of the groundbreaking land and building tax bill is likely to be postponed because lawmakers may not meet next month’s deadline for completing their deliberations. According to Deputy Finance Minister Visut Srisuphun, the bill needs to have its second and final readings later this year so that it becomes law and can be enforced beginning in early 2019 as the government pledged.

 

Upset over the likely further delay of this controversial legislation, observers have pointed fingers at big landlords and vested interest groups for stalling efforts and at members of the National Legislative Assembly. But Visut has suggested that the Bangkok Metropolitan Administra-tion (BMA) and other local government units that will be responsible for collecting the new taxes are the culprits because they appear unready to tackle the tasks.

 

Technically, the bill has to be enacted into law first to empower the BMA and the Or Bor Tor local government units to survey vacant property and buildings and calculate the new tax rates. For this they will need unspecified additional time to get ready. And because of that, the government will not be able to keep its promise to break new ground in social equity and tax collection, especially with regard to the country’s relatively very low tax rates on land and buildings.

 

The low rates have deprived both the central and local governments of income amid rising public expenditure. In the meantime, tax revenues from personal and corporate incomes, from consumption (value-added tax) and from import duties have been on the downward trend. Until the new land and building tax bill is enacted, the economy will lose out on another crucial benefit of the bill, which is also aimed at penalising owners of unused land plots with a progressive tax regime.

 

Even before the bill is passed, many landlords have expressed interest in selling or have already sold large idle plots to avoid a future tax liability, thus boosting the amount of land available on the market for national development. 

 

More importantly, the BMA and other local government units will have more financial resources for community development and welfare, while the fiscal burden on the central government will be lessened.

 

Yet the majority of lawmakers in the National Legislative Assembly are major landlords who will face the consequences of this tax liability. It is likely that the bill will face more challenges if it is not passed during the tenure of this national assembly. And the politicians who form the next government following the general election in 2019 will have more incentive to derail the bill.

 

Under this scenario, Prime Minister Prayut Chan-o-cha, who supports passage of the legislation, is urged to step in and apply more pressure on the National Legislative Assembly to get on with the job. 

 

They must complete the enactment and adopt practical solutions to address implementation issues as cited by the BMA and other local government units. 

 

Unless a non-elected government like Prayut’s pushes through this unpopular tax legislation, elected governments would find it even harder, as evidenced by previous governments’ attempts to revamp the tax, all if which were ultimately aborted.

 

Source: http://www.nationmultimedia.com/detail/opinion/30351858

 

-- © Copyright The Nation 2018-08-10

[Samui Bodoh]

"...Upset over the likely further delay of this controversial legislation, observers have pointed fingers at big landlords and vested interest groups for stalling efforts and at members of the National Legislative Assembly..."

 

Of course 'vested interests', 'big landlords' and 'members of the NLA' are blocking the legislation; they are the ones who would be taxed. Did you think they would willingly go along with raising their taxes? Did you think they would act altruistically? Further, they are the Junta's main constituency; did you think the Junta was going to side with the proverbial 'little guy' over their rich backers? Finally, did you think the coup and coup-makers were not going to protect the wealthy? The whole reason for the coup was to protect the 'haves'.

 

"...Prime Minister Prayut Chan-o-cha, who supports passage of the legislation, is urged to step in and apply more pressure on the National Legislative Assembly to get on with the job..."

 

 

Puuuuleeeeze!

 

If Prayut genuinely wanted this bill to pass, he could use Article 44, but he doesn't. More political "well, I really, really really want to help, but..."

 

And the rich will continue to get richer and the poor will continue to get poorer.

 

Meet the new boss, same as the old boss...

 

Edited August 9, 2018 by Samui Bodoh
Lack of coffee

[mikebell]

46 minutes ago, Samui Bodoh said:

And the rich will continue to get richer and the poor will continue to get poorer.

Exactly why this bill will be delayed until February 2088.

[Cadbury]

The elite will soon put a stop to this nonsense. They will lobby (tell) the junta to have all land within Bangkok city boundary exempted from the tax. Farmland can be taxed double to make up for any losses.

[Lungstib]

1 hour ago, webfact said:

Yet the majority of lawmakers in the National Legislative Assembly are major landlords who will face the consequences of this tax liability.

Which is why anything similar has never been passed before and this is delayed. But it does highlight the poor flow of information regarding the wealth of the current NLA and how little the public know about their wealth in cash or land. The massive difference between the wealth of the average citizen and a member of the NLA needs to be spoken about. At least with past elected govts we knew they were millionaires. We even knew where they said the money came from but how does a collection of military and police manage the same wealth?

[worgeordie]

They are not going to pass any law that affects themselves,

even though it's the right thing to do,for the country,more

taxes are needed,where else will the money come from to

buy more weapons of war,and be wasted on unviable projects.

regards worgeordie

[zyphodb]

Obviously never, only the poor pay tax, the same to a certain extent the world over, but needless to say much worse here....

[sammieuk1]

You got me on the wine tax "just" but your never going to get me on any land tax?

[seajae]

once again the rich in Thailand refuse to pay their share of the taxes, this is absolute BS, where is article 44, this should be pushed through and these mongrel legislators held financially responsible, it is a corrupt action by them to stop them having to pay taxes if they do not pass the legislation. This is a huge embarrassment to the govt because it shows just how greedy they are, money is more important to them than the country itself, this shows just how corrupt they really are

[Srikcir]

5 hours ago, Cadbury said:

The elite will soon put a stop to this nonsense.

I believe that the "elite" put themselves in a Catch-22 situation.

The Bill has passed its first reading in the National Legislative Assembly (NLA). May 2017

https://www.amchamthailand.com/acct/asp/news.asp?NewsID=118

Plenty of time to enact the bill by January 2018.

 

The NLA was appointed by Prayut and surely represents the "elite." Why would they want to propose and pass higher property taxes that will impact their own wealth? They could have chosen not to draft legislation at all or even propose to lower existing property taxes.

I suggest that in part the elite wanted to enable the junta through a more enriched treasury to continue its free spending agenda that ultimately would gain significant public political support, ie., in the next election for pro-military political parties. And as a side effect provide the elite with "wealth opportunities" to be key players in the junta's spending.

 

Perhaps realizing the high price the elite will pay for such a political boon for the junta (the Catch-22), they hesitated:

NLA committee slashes draft land bill tax rates December 2017

The standing committee on the land and buildings tax has largely watered down the new property tax rates.

http://aec.utcc.ac.th/thailand-nla-committee-slashes-draft-land-bill-tax-rates/

 

By June 2018 the NLA scrutiny committee announced it would seek the government’s opinion about its proposal to amend the Land and Building Tax bill to make it enforceable in 2020 instead of 2019.

https://news.thaivisa.com/article/22054/nlas-scrutiny-committee-mulls-postponing-new-land-tax-bill-until-year-2020

Essentially, the NLA seeks to move enactment of the law into the term of the next (elected) government. If that government is pro-military (ie., Prayut as PM), it can revisit the new law and further pare it down to less pain or the impact of the new taxes by continuing to have influence in the government to access further "wealth opportunities."

 

[watcharacters]

6 hours ago, mikebell said:

Exactly why this bill will be delayed until February 2088.

 

That soon?

[watcharacters]

5 hours ago, worgeordie said:

They are not going to pass any law that affects themselves,

even though it's the right thing to do,for the country,more

taxes are needed,where else will the money come from to

buy more weapons of war,and be wasted on unviable projects.

regards worgeordie

 

I thought the basis of the wealth of the elite is they own most of the country "tax free".

 

 

[brucec64]

"...Upset over the likely further delay of this controversial legislation, observers have pointed fingers at big landlords and vested interest groups for stalling efforts and at members of the National Legislative Assembly..."
 
Of course 'vested interests', 'big landlords' and 'members of the NLA' are blocking the legislation; they are the ones who would be taxed. Did you think they would willingly go along with raising their taxes? Did you think they would act altruistically? Further, they are the Junta's main constituency; did you think the Junta was going to side with the proverbial 'little guy' over their rich backers? Finally, did you think the coup and coup-makers were not going to protect the wealthy? The whole reason for the coup was to protect the 'haves'.
 
"...Prime Minister Prayut Chan-o-cha, who supports passage of the legislation, is urged to step in and apply more pressure on the National Legislative Assembly to get on with the job..."
 
:cheesy::cheesy::cheesy::cheesy:
 
Puuuuleeeeze!
 
If Prayut genuinely wanted this bill to pass, he could use Article 44, but he doesn't. More political "well, I really, really really want to help, but..."
 
And the rich will continue to get richer and the poor will continue to get poorer.
 
Meet the new boss, same as the old boss...
 

You are exactly right. The NLA can pass a multi trillion baht budget in an afternoon, with half of them asleep. They country needs this tax, and they could have achieved one good thing in their useless 4 year tenure, but even failed at that.

Sent from my SM-N950U1 using Thailand Forum - Thaivisa mobile app

[Chris Lawrence]

The big end of town have some massive holdings. Some of the retail will be the most expensive in the world, whist the FSR will drag in the money as well. So who is scared.

 

What about CG tax on share trading?

[Chris Lawrence]

So is this an issue the general will campaign on? Or what about dams? Or where the 40% went to from Chiang Rai? These become political platforms. Aint seen any yet?

[stud858]

A no brainer.an excellent common sense law for a society.  unoccupied realestate should be taxed. 

[rumak]

2 hours ago, zyphodb said:

Obviously never, only the poor pay tax, the same to a certain extent the world over, but needless to say much worse here....

First part i believe.....as for much worse here, don't believe.     Same if not worse in other places.

IMHO

[timber]

Understand why an undemocratic decision is needed to benefit the rural communities, as the legislators will not pass it.  In North America land taxes pay for education, so major land owners contribute monies to all.  The taxes are based on productivity and use.  Forest land has a low tax base and contributes a lot to employment, and schools in the lower income communities.  The same in agriculture.  If land not used, pay a higher tax, so land owners normally put land into some kind of forest licence which requires management.  There is an incredible amount of land that is not being used in Thailand, and could provide provide employment to the local community, and taxation would raise the educational standards. With the age of robotics so quickly,, educational standards need to be raised, and communities better supported in the rural areas. Timber grows quite quickly in Thailand, and the sites are good enough, that a lot of jobs could be created in forest management, and product development.  In our area timber grows to a size in ten years that would require 45 - 50 years in a lot of areas in North America.  So the returns are such, that a lot of companies would be more than happy to invest monies in a Thai Forest Industry.  The biggest decision is to allow enough area for the forest and a secure tenure.