Thai Finance Minister Sommai pushes on with land and building taxes bill

[Ricardo]

Hey Mr. Finance minister. What is your net worth? You're upset because many Thai's are selfish. Maybe they are genuinely poor and will find it difficult with all these stinking taxes. I don't agree one bit with paying more taxes on land people have already purchased. Taxes are nothing more than a money grab. People pay enough taxes as it is. Down with taxes. People pay taxes on their salaries, taxes on food,gas every god damn thing around we pay taxes for,and I'm not just talking in Thailand.

" taxes on food"

Please feel free to correct me, if I'm wrong, but I don't think VAT is charged on basic foodstuffs in Thailand ?

Although it is often charged on the bill from larger restaurants, or businesses like hotels or fast-food chains, IME.

Personally I'd welcome a tax on sugar, since it is very unhealthy, in the quantities which Thais consume !

"taxes on land people have already purchased"

We pay a princely sum of about B200 per-annum to our Tambon, for some sort of local land-tax, based on our 3.5 rai. We didn't even know it existed, because they never sent out annual-bills, as the proceeds didn't justify the expense of doing-so !

We also pay some B400-per-rai on some irrigated land, because it's serviced by a purpose-built irrigation-canal.

I'm making the point that some land-tax does already exist, albeit trivial amounts.

[tomacht8]

...... the ministry's tax reform committee to endorse this week .....

Always this ill-considered populist quickly shots.

Over 85% of the land in Thailand are not even measured, and equipped with GPS land papers.

Where should come at once all the experts from, to make the assessment / valuation of the houses?

Is the whole land taxation system ever supported with computer technology?

Thailand's politics are world champions of new ideas.

Every day three new ideas.

In the implementation unfortunately, they are often fail.

So over 85% of the land cannot be bought and sold as no value can be ascertained nor tax be computated?

In principle, yes.

There are many different land titles.

Only with Nor Sor Sam, Nor Sor Sam Gor or Chanote paper you can get a bank mortgage.

(only Chanote paper has GPS measurement)

Farmland is usually Nor Sor or Tor Bor 5 Land.

Land prices vary enormously in dependence on the existing land paper, location and infrastructure (road access, water, electric).

We pay land tax every year.

For our TB5 land we get a hand written receipt, no computer.

Many houses are traditional built on land without ever having asked a government agency.

We have several houses.

One house we built 12 years ago.

Material costs were 2 million baht 12 years a go.

Labor was provided by the family.

Now it has some strong signs of wear

So what is my house worth today?

There are many other parameters, such as in the field of finance.

Today I read that debt should be removed from the house value.

So friends give each other loans on their homes to avoid the tax.

The introduction of new taxes should be carefully thought out and planned so that the tax at the end is also fair to all.

In this case, I doubt it.

[Pib]

These bills were the right thing to do to increase the nation's budget to help finance the myriad cash handouts, subsidies, and off-budget items Prayut keeps giving to quell protesters. Also, Sommai was ordered by Prayut to develop such new taxes and he's delivered. The land and building taxes could use some further tweaking to make them more palatable such as a longer phase in period or "grandfather" clauses that new taxes would only apply to new real estate purchases as of July 1, 2015.

UNFORTUNATELY ....

When Prayut tasked Sommai for new taxes last year, Prayut was perhaps under some illusion of his economic prowness to predict 3-4% GDP growth in 2014 and 4% in 2015. These taxes would have been justified to slow such inflation. The only blame Sommai should bear is taking too much time to propose the taxes. It's not like he or Prayut had to consider public opinion or opposition in the NLA.

Now it's clear that GDP growth in 2014 was almost nonexistent and 2015 at best will show only a meager increase. The economy is in a tailspin towards deflation with an increasing cost of living and higher personal debt. Higher taxes now will only further damage Thai's ability to increase personal consumption that is about the only economic factor left to contribute to GDP growth after tourism.

Rather than taking responsibility for the deteriorating economy (the worse since the floods of 2011) in 2014 and 2015 that would have not justified more taxes, Prayut chose to blame Sommai for inappropriate taxes. Some say a good general rides in front of his soldiers going into battle. General Prayut seems to lurk behind his soldiers when the charge is made.

"only apply to new real estate purchases as of July 1, 2015."

So by the time the next government is elected, the revenue raised will be almost nothing, and they can justifiably can it? And all the real estate in possession of the wealthy remains untaxed until they sell it, which may be never?

Yea if the proposed property tax only applied to new purchases as of 1 Jul 15 that means all the land and property in the country would be tax exempt until sold on/after 1 Jul 15....the tax would basically bring in no to extremely little revenue. Plus I expect it would even slow down new purchases...make people think twice about purchasing a new property...instead lets wait a while in hopes of the tax being rescinded. But maybe Stickcir meant to say "not to start applying the tax until Jul 15 or some other date." There has been talk that even if the property tax proposal made it into law this year the law would say the tax would start being applied until mid 2017.

But hopefully the property tax proposal is dead for at least a few more years; right now after the PM's announcement he want's it shelved/studied more its strong backers like the Finance Minister is just going through a face-saving reaction/temper tantrum with the PM pulling the rug from out under their feet after the PM told them to check out the feel of the rug.

Edited March 18, 2015 by Pib

[casualbiker]

Casualbiker. Railways are paid by fares purchased, hospitals are paid for by patients bills,roads are paid for by gas taxes. If a person doesn't have children or sends them to a private school why should they be forced to pay for another persons child to attend a government school. All I'm saying is that people pay too many taxes. You buy a new car you pay tax, you sell that car to another person and guess what ,they pay tax on an item that was already taxed and it goes on and on and on.

Idiablo... you honestly think that here in Thailand railways are paid for by fares! And that the free health care system is paid for by patients bills and equally laughable roads are paid by gas taxes ( I presume you mean petroleum taxes)

They are not!

As for education.. Because it makes for a civilised society. Most people understand this!

I'm not sure were you get this idea about selling cars in Thailand.. the only tax is yearly road tax.

I'm guessing your American. Am I right?