Expert Urges Government To Raise Tax For Foreign Condo Buyers

[RSD1]

There was an article that was posted on the KSE website about 3 weeks ago titled "Expert Urges Government To Raise Tax For Foreign Condo Buyers". 
 

The concerning part is the following info from that article:

 

Quote

Dr. Sopon further mentioned that it is obvious that foreigners have a strong preference for buying condominiums in Thailand. Therefore, AREA proposes to the government under Paetongtarn Shinawatra to regulate the purchase of real estate by foreigners by imposing higher taxes on foreign buyers than on Thai nationals, as is common practice in many countries.

 

He proposed four types of property taxes on foreigners based on market transaction prices (rather than government-assessed values) to raise revenue to boost the economy and increase funds for national development:

 

Purchase tax or transfer tax: Levied at the Land Department on transactions, with a tax rate of 10-20 percent or 100,000 to 200,000 baht per million baht.

 

Property Tax: With a tax rate of 1 percent or 10,000 baht per million baht.

 

Capital gains tax on resale: With a tax rate of 10-20 percent or 100,000 to 200,000 baht per million baht.

Inheritance tax: Proposed at a rate of 10 percent of the market value of the estate or 100,000 baht per million baht.

If any of these 4 proposed taxes get imposed then it will bring about a screeching halt to foreigner condo purchases in Thailand. It could also be another reason to cause a mass exodus of foreigners already living in Thailand. 
 

Thailand has seen a recent uptick in condo sales to Chinese and Russian buyers over the last two years, people who might not care so much about the taxes because many of those buyers were just trying to escape their own country. But that is likely to have already largely stopped. The number of Russians flooding into Thailand to buy property and avoid the war in Russia has probably steeply declined already. And the Chinese economy is in trouble, so the number of new Chinese condo buyers has presumably also plummeted. 
 

The problem with all this new taxation on property is that it would also affect all the foreigners who have already bought condos in Thailand in the past. This would be largely unfair. They should be grandfathered under the old laws because they bought prior to any of the newly proposed property tax laws on foreigners. 
 

Who knows how realistic any of this is. But if they start taxing foreigners on their worldwide income, and then on condo ownership, it's going to be devastating to the local economy as all that foreign money finds much greener pastures elsewhere. 

[phetphet]

I suggest Dr. Sopon is living in some fantasy land.

 

Foreigners only have a preference for buying condos as it's the only legal way to own property here. 

 

Make it too expensive and the condo market will collapse in a heartbeat.

 

[Lorry]

4 hours ago, phetphet said:

Make it too expensive and the condo market will collapse in a heartbeat

The condo I am looking at right now is 42m

Across the street,  a big advertising for not yet built condos in a low-class neighborhood, 32m

Not talking about lower Sukhumvit,  where they advertise 100m up

 

Mr Sopon has learned the same lesson as every bargirl and every international hospital: the wallets of foreigners are bottomless. Foreigners will pay any price. 

There is no such thing as "too expensive" for foreigners. 

 

 

 

[PuiPuiHarry]

I advise Dr Sopon to look at some other countries, like Philippines, Vietnam, but also Latin America. As soon as it is known the possibilities in these countries are better, many will leave, and Thailand will wean about the goose who laid the golden eggs disapperared to another nation. I could already convince my Thai lady NOT to settle in TH anymore.

[Johno57]

I am on the verge of buying a condo in Hua hin in my thai wifes name, as I am told this would cut down the the paper work & conditions down..but any more talk of taxes & racist conditions being made & I will simply rent &so will every body else...

Edited September 22 by Johno57

[jippytum]

 The goverment renacted the land tax about five years ago and applied it to Foreign and company owned units only. Thai owners are exempted from the tax. 

Currently the tax is a small amount but company owned property  owners had to pay tax from the date the company was formed not the date the tax was reintroduced. In some cases the amount due was considerable. 

So tax on foreign condo owners is already enacted. 

[Bday Prang]

Another redefining the definition of the word "expert"

[tomazbodner]

13 hours ago, RSD1 said:

Dr. Sopon

This Dr. Sophon?

https://www.thansettakij.com/real-estate/588814

 

Translation below:

Encourage foreigners to buy Thai real estate after making a new high, buying condominiums in Bangkok and surrounding areas, 31,601 million.

https://eng.scancondo.com/Articles/189/Encourage-foreigners-to-buy-Thai-real-estate-after-making-a-new-high,-buying-condominiums-in-Bangkok-and-surrounding-areas,-31,601-million.

[john donson]

so on top of paying tax up to 35% and getting nothing in return, the capital gain tax or special business tax already applies if you would dare to sell your condo within 5 years of purchase... farang haf bottomless pockets syndrome?

[JackGats]

4 hours ago, Johno57 said:

I am on the verge of buying a condo in Hua hin in my thai wifes name, as I am told this would cut down the the paper work & conditions down..but any more talk of taxes & racist conditions being made & I will simply rent &so will every body else...

Then what is the point of not losing money to the Thai government if you are going to lose it all to a wife or ex-wife? Men think they are clever doing things "in my wife's name" while all they're doing is jumping out of the frying pan into the fire.

[chiang mai]

"as is common practice in many countries:.

 

It's a tactic to help prevent speculation by foreign buyers who drive up the prices and make them unaffordable for many locals. Is it good or bad? If the motive is to protect Thai nationals, it's hard to disagree with.

[Lorry]

4 hours ago, jippytum said:

 The goverment renacted the land tax about five years ago and applied it to Foreign and company owned units only. Thai owners are exempted from the tax. 

Currently the tax is a small amount but company owned property  owners had to pay tax from the date the company was formed not the date the tax was reintroduced. In some cases the amount due was considerable. 

So tax on foreign condo owners is already enacted. 

This is not true.

If the owner lives  himself in his own property, he doesn't have to pay this tax.

It's quite easy to apply for this tax exemption at the Amphoe, bring housebook,  chanote, ID. It doesn't matter he is Thai or foreigner. 

 

If the owner doesn't live in his property,  he needs to pay this tax. It doesn't matter he is Thai or not.

These people (renting out property or flipping condos) are usually called speculators, but there many words much worse for them. 

[jippytum]

3 minutes ago, Lorry said:

This is not true.

If the owner lives  himself in his own property, he doesn't have to pay this tax.

It's quite easy to apply for this tax exemption at the Amphoe, bring housebook,  chanote, ID. It doesn't matter he is Thai or foreigner. 

 

If the owner doesn't live in his property,  he needs to pay this tax. It doesn't matter he is Thai or not.

These people (renting out property or flipping condos) are usually called speculators, but there many words much worse for them. 

it is true... foreign owners must have a yellow book to avoid this tax in Chonburi

[Lorry]

19 minutes ago, jippytum said:

foreign owners must have a yellow book to avoid this tax in Chonburi

Yes, of course,  I said that. 

The proof of living at a place is the housebook.

And an owner is legally obliged to get a housebook.

These are very basic principles of the Thai legal system. 

(I have heard,  that not all laws are strictly followed in Thailand.  Hard to believe,  isn't it?)

 

Your claim that it's a tax for foreigners,  not for Thais,  is still patently untrue.

If Ms XXX has her housebook in Buriram, and from her hard earned cash she buys a condo in Pattaya,  she will get a yearly tax bill. If she wants to apply for exemption from this tax, she needs her house registration moved to her Pattaya condo. 

The application is not difficult.

[Letseng]

17 hours ago, RSD1 said:

There was an article that was posted on the KSE website about 3 weeks ago titled "Expert Urges Government To Raise Tax For Foreign Condo Buyers". 
 

The concerning part is the following info from that article:

 

If any of these 4 proposed taxes get imposed then it will bring about a screeching halt to foreigner condo purchases in Thailand. It could also be another reason to cause a mass exodus of foreigners already living in Thailand. 
 

Thailand has seen a recent uptick in condo sales to Chinese and Russian buyers over the last two years, people who might not care so much about the taxes because many of those buyers were just trying to escape their own country. But that is likely to have already largely stopped. The number of Russians flooding into Thailand to buy property and avoid the war in Russia has probably steeply declined already. And the Chinese economy is in trouble, so the number of new Chinese condo buyers has presumably also plummeted. 
 

The problem with all this new taxation on property is that it would also affect all the foreigners who have already bought condos in Thailand in the past. This would be largely unfair. They should be grandfathered under the old laws because they bought prior to any of the newly proposed property tax laws on foreigners. 
 

Who knows how realistic any of this is. But if they start taxing foreigners on their worldwide income, and then on condo ownership, it's going to be devastating to the local economy as all that foreign money finds much greener pastures elsewhere. 

You are aware that Thailand will be no different to other countries if they go ahead. There is higher taxation for foreign buyers of properties in Singapore. Did it change much? No. Worldwide taxation is due to OECD rules. TH has applied for membership & rules apply. 

[Muhendis]

4 hours ago, Bday Prang said:

Another redefining the definition of the word "expert"

He's an expert without a doubt.

 

https://www.area.co.th/english/president.php

 

Ph.D. Land and Housing, Asian Institute of Technology (AIT), Bangkok.

Dipl.FIABCI, International Federation of Real Estate

Certificate Property Appraisal, Land Reform Training Institute - Lincoln Institute of Land Policy

Certificate Housing in Development, PGCHS, Katholieke Universiteit, Leuven, Belgium

Certified Residential Specialist, National Association of Realtors, USA.

Certificate Real Estates Appraisal, Thammasat University, Bangkok

Certificate, Anti-Corruption Program for High Level Executives, National Anti-Corruption Commission

 

And the list of achievements goes on.

If I was as well qualified in my chosen field I would undoubtedly be regarded as an expert to whom all others turn.

[jippytum]

11 minutes ago, Lorry said:

Yes, of course,  I said that. 

The proof of living at a place is the housebook.

And an owner is legally obliged to get a housebook.

These are very basic principles of the Thai legal system. 

(I have heard,  that not all laws are strictly followed in Thailand.  Hard to believe,  isn't it?)

 

Your claim that it's a tax for foreigners,  not for Thais,  is still patently untrue.

If Ms XXX has her housebook in Buriram, and from her hard earned cash she buys a condo in Pattaya,  she will get a yearly tax bill. If she wants to apply for exemption from this tax, she needs her house registration moved to her Pattaya condo. 

The application is not difficult.

The  land tax demands are not sent to Thai  registered owners of condos  in my building Chonburi. Only to foreign and company owned condos. 

 I have never suggested Thai landowners are not subject to the tax . The post referenced condo owners. 

[Lorry]

2 minutes ago, jippytum said:

The  land tax demands are not sent to Thai  registered owners of condos  in my building Chonburi.

They are lucky, or they applied for tax exemption already.

These tax letters are sent to Thai owners in my building (Bangkok).

[Lorry]

People here haven't seen the property bubble in China. 

Just imagine the worst you can imagine.  Then multiply by 100. Then you come close. 

You want this here?

Remember Vancouver. Remember Sihanoukville. 

 

 

 

[Unamerican]

43 minutes ago, Lorry said:

The proof of living at a place is the housebook.

And an owner is legally obliged to get a housebook.

Not for condo owner-occupiers, surely!  Most do not have a housebook, only a TM30. 

[Lorry]

3 hours ago, Unamerican said:

Not for condo owner-occupiers, surely!  Most do not have a housebook, only a TM30. 

Surely for condo owner-occupiers, too.

That many foreigners chose to live outside the normal legal structures of Thailand doesn't change these structures. 

Of course, it's easier that way - but buying a condo without having a housebook  is almost like buying a condo without a chanote (I know, some people do that).

There are even educated middle-class Thais who buy, own and sell condos and don't give a shít about housebooks.  But this still doesn't change the legal structure (which is followed by most Thais).

 

Many people think this is Kansas 1840 - no laws, no law-enforcement, no administration. 

But this isn't Kansas anymore. 

[KhunHeineken]

If someone is looking at retiring to Thailand in the near future, they probably should consider moving their 800k, buying a condo, buying a car (if they want a car)  and living expenses for a while, and then staying outside of Thailand in that tax year.  

 

Moth ball the condo and car. 

 

Why risk paying tax on all the funds, for the sake of staying out of Thailand just for 6 months?  

[Unclernie]

Does some idiot get paid to think up these buzz kill taxation schemes. The level of incompetence is astounding. Then again they must be so happy within their own ignorance 

[mdr224]

I would take the degrees of every thai expert and use them to wipe the <deleted> off my ass

[Mason45]

On 9/23/2024 at 5:39 AM, Johno57 said:

I am on the verge of buying a condo in Hua hin in my thai wifes name, as I am told this would cut down the the paper work & conditions down..but any more talk of taxes & racist conditions being made & I will simply rent &so will every body else...

I have 3 properties all in my wife's name. There's been no problems so far and we've been married for 22 years. Thai women aren't the only ones who choose to take their husbands / partners to the cleaners.

[Mason45]

10 minutes ago, mdr224 said:

I would take the degrees of every thai expert and use them to wipe the <deleted> off my ass

A friend of mine calls them the poo house prophets. They have all the answers but have never done anything they rave on about.

[KhunHeineken]

On 9/24/2024 at 10:17 PM, Unclernie said:

Does some idiot get paid to think up these buzz kill taxation schemes. The level of incompetence is astounding. Then again they must be so happy within their own ignorance 

Why do you think they are an idiot?

 

They know they have falang by the b*lls.  They have squeezed them for years.  They are just squeezing more now. 

 

It's always been this way.  Why are you surprised? 

 

 

[KhunHeineken]

On 9/22/2024 at 10:39 PM, Johno57 said:

I am on the verge of buying a condo in Hua hin in my thai wifes name, as I am told this would cut down the the paper work & conditions down..but any more talk of taxes & racist conditions being made & I will simply rent &so will every body else...

What floor is the condo on? 

[timendres]

On 9/23/2024 at 9:49 AM, chiang mai said:

"as is common practice in many countries:.

 

It's a tactic to help prevent speculation by foreign buyers who drive up the prices and make them unaffordable for many locals. Is it good or bad? If the motive is to protect Thai nationals, it's hard to disagree with.

 

I think there might be one other thing going on here.

 

The Thai government is getting quite desperate for revenues.

They are frantically looking everywhere for potential income (spelled tee aitch e ef tee)

 

To @chiang mai's point, I suspect the potential tsunami of money that would like to

escape China is also a concern. Not so much to protect Thai nationals, but to prevent

an unsustainable inflation that could jeopardize their banking system. I suspect that the

ghosts of the Tom Yum Kung crisis still haunt decision makers here.

 

[KhunHeineken]

16 minutes ago, timendres said:

 

I think there might be one other thing going on here.

 

The Thai government is getting quite desperate for revenues.

They are frantically looking everywhere for potential income (spelled tee aitch e ef tee)

 

To @chiang mai's point, I suspect the potential tsunami of money that would like to

escape China is also a concern. Not so much to protect Thai nationals, but to prevent

an unsustainable inflation that could jeopardize their banking system. I suspect that the

ghosts of the Tom Yum Kung crisis still haunt decision makers here.

 

Answer to that problem is, tighten up on foreign ownership.  Eg. more tax. 

 

Boils down to, current owners will have a declining market, and new builds/ developers a declining market also. 

 

There's already a massive oversupply of property in the market in all of the major tourist areas. 

 

The Thai's don't want to cause a "market correction."   They just want more of a slice of the "market." 

 

Get the balance wrong, and, well, the market could tank, but the oversupply was already pushing prices lower anyway, yet, they keep building, and building.