Plans for a property and land tax !!

A draft bill on land and property tax will be presented to the cabinet for consideration in August, Finance Minister Korn Chatikavanij said on Friday.

If approved it would go to the parliament. The govenment would then spend at least one year explaining to the people how the land and property tax would be collected, before it was implemented, he said.

Mr Korn said in the principle behind the land and property tax was to encourage people to make the most use of their land.

The minister used his own declared assets as an example.

He had asked the the Fiscal Policy Office to calculate how much tax he would have to pay on his land if the bill was passed into law.

The office told him that he would have to pay 860,000 baht per year. This made him think that he should sell some land which was lying unused.

Mr Korn said the government has no plans to propose an inheritance tax at this time.

http://www.bangkokpost.com/breakingnews/145920/g ov...

Pilot land project set to be launched
By Pongphon Sarnsmak
The Nation

Govt to spend Bt200m on 1,655 rai in the North for distribution to poor; property, land-tax bill going ahead

The government will spend Bt200 million to purchase 1,655 rai of land in Chiang Mai and Lamphun and distribute it to landless poor as a pilot project in land reallocation aimed at eventually narrowing the income gap and other inequalities.

At the seminar entitled "Land Management: Problems and Resolutions" at Government House, Deputy Interior Minister Thaworn Senneam told the audience a public agency would be set up to reallocate land to the poor. The agency should function for three to five years until formation of the Land Bank.

A draft bill to set up the Land Bank is being screened by the Council of State. The bank will be managed and administered by a committee comprising representatives from the interior, agriculture and finance ministries, community members and experts.

Reducing poverty

"This is part of the government's policy of reducing poverty and income inequality," Thaworn said.

At the seminar, Prime Minister Abhisit Vejjajiva said that in addressing the fact that many have no land while a few had large land holdings, his government was focusing on these four policies:

n It will push for a community title-deed law, to allow communities to own and manage their own land. Within a few months, communities in 30 pilot locations will be handed title deeds.

n Property and land taxes will be enforced, charging landlords who make no use of their land.

n The government will push for a law to support Land Bank operations.

n It will also complete a land database to clear up conflicting ownerships.

The Natural Resources and Environment Ministry will spend two years on the land survey.

Finance Minister Korn Chatikavanij said the government is now pushing forward the progressive property and land-tax bill. While land used for agricultural purposes is charged a low rate, owners of abandoned land will be charged more.

"I believe this bill will help us reduce income and social inequalities," he said.

Two per cent of collected property and land taxes, or about Bt500 million, will be used to support the Land Bank, with the rest going to local governments.

Bt25 billion revenue

He estimates the revenue collected under the new law at Bt25 billion per year.

"Drafting the law is a complicated process, due to many obstacles ... But the government is determined to push for the most concrete law, to reduce disparities and create fairness in society. No government would dare turn their backs on real public needs," Korn said.

The finance minister said some 90 per cent of Thais owned less than 1 rai each while the rest owned 100 rai or more. He expects the bill to be the first to be discussed when Parliament resumes in August.

Thaworn said Bt200 million would come from the central budget. The Community Organisation Development Institute will run the project.

The poor can lease land from the government or obtain the licence to use the land.

A special working group, including representatives from the Lands Department, is in place to study the purchase of land from their owners.

Aardvark wrote:Sounds like Socialism to me !!

Thai Finance Minister remains commited to new property tax
Saturday, August 7, 2010.

The Royal Thai Government remains committed to implementing a proposed asset tax that will affect property owners across the country said Finance Minister, Korn Chatikavanij, at the Foreign Correspondents’ Club of Thailand, Wednesday.

The proposed bill has been approved by the cabinet and is currently being vetted by the Thai Attorney General, but is unlikely to be submitted for parliamentary approval until the next session, he revealed. Only then will the exact details of the proposed bill be made public.

The tax has raised concerns amongst foreign and domestic property owners that the bill will erode Thailand’s investment potential. Acknowledging that the tax will certainly face opposition, Korn remains adamant that it is necessary as part of wider tax reforms to distribute the tax burden more equally across the country.

Arguing the need to rebalance the “very unfair distribution” of tax that is currently based on income, not wealth, Korn explained that the Bank of Thailand’s proposed minimum property value would exclude 90% of property owners in Thailand, but in doing so, only 10% of tax revenues.

The proposed bill will enforce incremental increases on land and buildings ranging from 0.5 to 2% with the tax expected to act as leverage on property owners with unused plots to release more land onto the market, fuelling further investment and economic growth.

The government aims to collect at least THB20 billion a year, the same as the land development and land and building taxes, the two existing laws that would be replaced by the new property tax.

Approximately 90% of tax revenues are currently derived from taxes on employment, effectively penalising the poorer rural and urban labour force that the country relies on for its continued economic growth and who have been at the centre of Thailand’s ongoing political power struggles since 2006......................

http://thailand-business-news.com/real- ... perty-tax/

The proposed bill will enforce incremental increases on land and buildings