Thai Government Passes New Land and Building Tax Act

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Recently, the National Legislative Assembly passed the Land and Building Tax Act.

The new law will replace both the House and Land Tax and the Local Development Tax when it takes effect on January 1, 2020.

The bill alters land and building tax laws in Thailand by placing property into four distinct legal categories: agricultural, residential, commercial, and vacant.

Each property type has its own tax rates based on the appraisal value.

For agricultural use, there are five tax rates:

  1. 0.01% for land valued between 1 million and 75 million baht;
  2. 0.03% for land valued between 76 million and 100 million baht;
  3. 0.05% for land valued between 101 million and 500 million baht;
  4. 0.07% for land valued between 501 million and 1 billion baht; and
  5. 0.1% for land valued at more than 1 billion baht.

Agricultural land worth less than 50 billion is exempt from taxes if it is owned by a sole individual.

For residential use, there are four tax brackets:

  1. 0.02% for land valued between 1 million and 50 million baht;
  2. 0.03% for land valued between 51 million and 75 million baht;
  3. 0.05% for land valued between 76 million and 100 million baht; and
  4. 0.1% for land valued more than 100 million baht.

For first-time home-owners, a tax-exemption of up to 50 million baht is available.

For commercial use, there are five tax rates:

  1. 0.3% for land valued between 1 million and 50 million baht;
  2. 0.4% for land valued between 51 million and 200 million baht;
  3. 0.5% for land valued between 201 million and 1 billion baht;
  4. 0.6% for land valued between 1 billion and 5 billion baht; and
  5. 0.7% for land valued at more than 5 billion baht.

For vacant or unused property, there are five tax applicable rates:

  1. 0.3% for land valued between 1 million and 50 million baht;
  2. 0.4% for land valued between 51 million and 200 million baht;
  3. 0.5% for land valued between 201 million and 1 billion baht;
  4. 0.6% for land valued between 1 billion and 5 billion baht; and
  5. 0.7% for land valued at more than 5 billion baht.

The tax rate on vacant lands and buildings will increase by 0.3% each year but will not exceed 3%.

DBD Reduces Fee Requirement for Registering a Private Limited Company in Thailand

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When registering a private limited company in Thailand, the Thai government requires two specific fees to be paid to the Department of Business Development.

Recently, these fees have been lowered.

Prior to this new fee amendment, fees for registering a private limited company were subject to a maximum of 25,000 baht upon filing the Memorandum of Association (MOA) and a further 250,000 baht upon finalizing the registration.

These fees, based on capitalization, could place a significant financial burden on companies.

Registration fees have now been reduced to a flat rate of 500 baht at the time of filing a MOA and another 5,000 baht when finalizing the registration.

So, in total, government fees for registering a new private limited company in Thailand have been reduced from 275,000 baht to 5,500 baht. 

The fee amendment demonstrates the efforts of the Thai government and the DBD on promoting business development in the Kingdom.

Consumer Protection Board Issues New Rules for Residential leases

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The Thailand Consumer Protection Board’s “Committee on Contract” has issued a notification making certain residential leases a whole lot more advantageous to lessees. 

Pursuant to the announcement, certain residential leases will be treated as “controlled contracts” under the Consumer Protection Act and will be subject to the following regulations:

  1. Rent cannot be collected more than one month in advance.
  2. Security deposits cannot be more than one month’s rent.
  3. Surcharges on electricity or water supply are not allowed (only actual charges by the utility providers are allowed).
  4. Forced evacuation or the removal of a defaulted tenant’s property from the leased area is prohibited.
  5. Renewal fees cannot be charged.

The above restrictions do not apply to all residential lease agreements, but only to those that meet the following conditions:

  1. the lessor (whether an individual or a legal entity) leases five or more residential units (in a house, apartment, condominium, etc) whether in the same building or otherwise;
  2. the building is not a licensed dormitory or hotel; and
  3. the tenant is an individual.

The notification was published in the Government Gazette on February 16th and is scheduled to take effect on May 1, 2018.

The notification does not include a grandfathering provision, so all residential leases that meet the conditions specified above will be subject to the new restrictions.

Violators are subject to a fine of up to 100,000 baht and/or a prison sentence of up to one year, pursuant to Section 57 of the Consumer Protection Act.

Megan’s Law Expat in Thailand

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Chaninat & Leeds, a Bangkok based law firm with myriads of experience in various areas of Thai and international law, discusses the repercussions of the International Megan’s Law and blacklisting on immigration of foreigners to Thailand.

US Immigration Attorneys in Bangkok focus on family-based immigration visas with a focus on the K1 fiancée visa and K3 marriage visa for Thai nationals. 

Related Article: Thailand Blacklist Regulations

Hague Treaty Child Abduction Thailand

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The Hague Convention on Child Abduction allows for claims by parents who have had their child abducted. The Thailand Child Abduction Act is the domestic law that allows for an aggrieved parent to enforce his rights to have his or her child returned to their country of residence.

For more information watch the full video where Chaninat & Leeds discusses the Hague Convention on child abduction in Thailand and it’s implications.

Current issues regarding Thailand family law are important for families that cross borders due to having different residences or due to business travel.

Related Journal:

Protecting Vulnerable Children in Thailand