BMA eyes new tax rate for so-called Bangkok plantations
The Bangkok Metropolitan Administration (BMA) is planning to clamp down on landowners who are converting their unused land into plantations to avoid paying the correct land tax.
The yearly tax for unused land is 0.3 per cent of the plot’s value, while the tax for agricultural land is only 0.01 per cent. Many landowners have taken advantage of this loophole and converted their land to plantations. However, this has reduced the earnings of local organisations.
Bangkok Governor Chadchart Sittipunt said land in the capital should be developed for commerce not agriculture in line with the city’s plan.
However, he said, land can be used for agriculture in the suburbs under the plan.
“The BMA cannot amend the Finance and Agriculture ministries’ definition of plantations, but it can determine the land tax on its own,” he said.
He said the BMA has written to a committee overseeing taxes on land and buildings asking if the BMA can raise the tax on plantations from 0.1 per cent to 0.15 per cent. The panel is chaired by Finance Ministry Permanent Secretary Krisada Chinavicharana.
“We will have to wait for the committee to come to a decision on Tuesday,” Chadchart said, adding that the BMA will draft regulations immediately if given the go-ahead.
Meanwhile, a source from the Interior Ministry said the BMA should take steps within the law, but should not increase the tax beyond 0.15 per cent.
The source said many land owners either do not want to sell the land they have inherited, are affected by the Covid-19 crisis or are waiting to sell when the economy is favourable.
“Most importantly, the BMA should pay attention to landlords’ right to use their land, otherwise it can be sued,” the source warned.