The Finance and Interior ministries are jointly assessing problems and obstacles related to the enforcement of the 2019 Land and Building Tax Act, says Fiscal Policy Office director-general Pornchai Thiraveja.
He said the two ministries are coordinating an analysis of land tax collection data, which includes following up on bottlenecks, evaluating the efficacy of the act, and whether amendments are needed.
Mr Pornchai said the efficacy of the law must be evaluated a minimum of every five years, which includes holding public hearings to obtain information and opinions from individuals and companies that own or have possessory or usage rights to immovable assets.
Under the previous regime, taxes were charged on earnings from renting or leasing out property and not on the asset itself, essentially serving as a form of income tax rather than a property tax scheme.
The new act gives local authorities the right to collect taxes on land and buildings in the country.
The objectives of the new act are to make tax collection more efficient and to increase public revenue.
He said returned questionnaires sent to relevant agencies to seek public opinion are being considered by the two ministries.
Taking effect in 2020, the new law stipulates a tax reduction during the first three years of enforcement, from 2020 to 2022, to ease the tax burden during the transition from the outdated House and Land Tax Act of 1930.
The value of land and buildings is appraised by the Treasury Department, and the price established by the appraisal serves as the basis for the calculation of the property tax, which is collected according to a progressive rate.
The tax ceiling on farmland is 0.15% and the effective rate is 0.01-0.1%.
Landowners are exempt from the tax for the first three years if they are individuals and the land appraisal price does not exceed 50 million baht.
The tax ceiling for residential land is 0.3% and the effective rate is 0.02-0.1%. Owners of first homes are exempt from property tax for land and buildings, up to a maximum value of 50 million baht, provided the owner's name is on the house registration.
Land for commercial and industrial use and vacant land has a tax ceiling of 1.2%, with an effective rate is 0.3-0.7%.
If the land or building is left vacant or undeveloped for three consecutive years, the rate increases by 0.3% every three years, subject to a cap of 3%.