Update on Proposed New TaxesComments Off on Update on Proposed New Taxes
According to media reports, the Finance Minister Mr. Sommai Phasee stated that the new inheritance and gift tax is expected to be submitted for the cabinet’s approval on this November 2014 and should be enforced in the year 2015. Please see his following information below:
- The draft will stipulate a minimum rate of 10% to enable future rises without amendment of the law.
- The ministry will start imposing the tax a 10% when at least 50 million baht in assets is passed down.
He also released the information that the Council of State will deliver the draft to him in this October 2014, and this draft will allow bequest beneficiaries to pay tax installments to ease their burden. However, he may ask the Council to review some issues such as loopholes likely to be used to avoid tax payments, such as preventing the use of nominees to receive inheritance.
He said that the new land and buildings tax would be the next change after the inheritance and gift tax. The new land and buildings tax will take effect a year and a half after publication in the Royal Gazette. Because the Government would like to give the Treasury Department time to assess the value of 23 million land plots to serve as the tax base.
The Treasury Department so far has appraised 7 million land plots on an individual basis. The Fiscal Policy Officer earlier proposed a ceiling rate of 4% for unused land and land for commercial use. For unused land, the rate will double every three years but not exceed a maximum level of 4% of appraised value according to a Finance Ministry source said earlier. Maximum rates will be set at 0.5% for agricultural use and 1% for residential use.
When the new land and buildings tax is enforced, it will replace the existing house and land tax and local development tax. Low-priced residences and land will likely be exempt from the new tax.