The Treasury Department is poised to announce a new land appraisal system that will be used as a computation base for the imminent land and buildings tax, its chief says.
The change in property prices after the launch of the current land appraisal price system in 2018 also contributed to the new land evaluation price announcement, said director-general Amnuay Preemonwong.
The land appraisal price system is typically announced every four years. The land and buildings tax will alter the way the Treasury Department appraises land prices by replacing block areas with land parcels to make property tax evaluation fairer.
A draft bill on the land and buildings tax has already passed three readings in the National Legislative Assembly (NLA) and is waiting for royal endorsement before publication in the Royal Gazette. The tax is scheduled to go into effect on Jan 1, 2020.
The land and buildings tax will replace the house and land tax and the local development tax, which have drawn criticism for being outdated.
Mr Amnuay said 20 million land parcels have already been appraised, while evaluation of the remaining 13 million parcels is expected to be completed by this year.
In the latest version, land and buildings used for residences with appraisal prices of up to 50 million baht will be taxed at a rate of 0.02%, those valued at 50-75 million baht will be taxed at 0.03%, those for 75-100 million baht at 0.05% and for 100 million baht and above at 0.1%.
For first-time homeowners, a tax exemption will be applied to the first 50 million baht of the appraisal prices of their houses if both the home and the land are owned.
Those who only own houses, but not land, will qualify for a tax exemption for the first 10 million baht of their houses’ appraisal prices.
Land used for agricultural purposes with appraisal prices of up to 75 million baht will be taxed at a rate of 0.01%, land appraised at 75-100 million baht will be taxed at 0.03%, land worth 100-500 million baht at 0.05%, 500 million to 1 billion baht at 0.07% and more than 1 billion baht at 0.1%.
Land used for commercial purposes will see a tax rate of 0.3% for property worth up to 50 million baht, a rate of 0.4% on land worth 50-200 million baht, of 0.5% for land valued between 200 million baht and 1 billion baht, 0.6% on land with a price tag of 1-5 billion and 0.7% on land worth 5 billion baht and above.
For undeveloped land a tax rate of 0.3% will be applied and increase by 0.3 percentage points every three years up to a cap of 3%.
Mr Amnuay said a draft act on asset evaluation for state benefits, which is scheduled to have a first reading in the NLA on Feb 14, will instate the finance permanent secretary as chairman for the land price appraisal process instead of the interior permanent secretary.
The draft act will shorten the appeals process on land price appraisal to one month from at least three months.
The draft act will also empower state officials to enter private property only for appraisal purposes with consent from landlords, Mr Amnuay said.