Thailand land tax reform due this year

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Thailand land tax reform due this year 
Bangkok Post: 16 Jan 2010
Land tax due this year
PM: Not popular but 'the right thing to do'

The long-awaited land and building tax has been tabled and should be enforced this year as the Thai economy is now on the path to recovery from the global recession, says Prime Minister Abhisit Vejjajiva.

Introducing the so-called asset tax is a key economic policy for the second year of the Democrat-led administration, along with restructuring agricultural debt and implementing the Thai Khem Khaeng scheme to cut logistics costs and strengthen the country's competitiveness, said the premier.

The draft of the law is set to be proposed to the cabinet for consideration in the first quarter, said Finance Minister Korn Chatikavanij.

"It's my intention to get the asset tax done this year," Mr Abhisit told the annual dinner of the Foreign Correspondents' Club of Thailand.

The tax, aimed at promoting more efficient use of property, will impose an annual charge on land assets and property nationwide, with local administrations being given flexibility in setting rates, based on their communities' development priorities."It [the tax] is not a popular thing to do in political aspects - like increasing taxes on alcohol and cigarettes last year, which we did because it is the right thing to do," he said.

Together with tackling economic issues, the government will do its best to end the instability in politics and reduce political divisions among Thais, he said.

"We don't want the country to be divided and won't let political divisions prevent the country moving forward. The government has taken the right approach to not allow political fighting to prevent economic progress and policy achievement," he said.

From today's perspective, the government is confident the Thai economy will grow by 3.5% or even higher this year, after shrinking by 3% in 2009, a much better performance than some experts' projections of a 9% contraction, he said.

Exports recovered impressively by 17% in November, while 1.6 million tourists arrived in December, bringing the year's total to 14 million, compared with a forecast of 10 million, he said.

"We have overcome economic difficulties and now recovery is on the way," said the premier. He vowed to work with other governments to ensure economic recovery on a global scale.

But foreign diplomats have said the government has moved so slowly to solve the Map Ta Phut impasse that the issue could affect economic recovery.

"I think the economic growth of 3.5% this year is realistic, but the Map Ta Phut issues should be ended as soon as possible because investors' confidence has been hurt badly," said David Lipman, head of the European Union delegation to Thailand.

Ron Hoffmann, Canada's ambassador to Thailand, called on the government to work with global communities to revive the frail world economy.

"Our [global] economy is still vulnerable and continues to be fragile," said Mr Hoffmann. "Every government has to work together and support each other as much as possible to prevent any shock that could make the global economy collapse."

www.bangkokpost.com/breakingnews/31116/land-tax-due-this-year