LAND, INHERITANCE LEVY 'MUST DO' POLICY
Prime Minister Abhisit Vejjajiva has pledged to introduce property and inheritance taxes, even if they cost the government popularity.
He would lobby government coalition partners to support the draft legislation when they meet today.
Mr Abhisit said the government would go ahead with the proposals as they were part of the country's tax reforms. The government was working to improve the public welfare system, and property and inheritance taxes would expand its revenue collection base.
On Friday, Finance Minister Korn Chatikavanij said the government wanted to take a new look at a land and building tax bill before the Fiscal Policy Office (FPO), first proposed over a decade ago to upgrade the country's tax system.
It has always been met by strong opposition from the public and politicians.
Mr Abhisit said the government also wants to introduce an inheritance tax, another long-shelved measure also before the FPO.
Mr Abhisit said the proposed property tax would combine land and building law and local development tax law to generate "handsome" revenues for local organisations.
Under current law, no tax is applied on earnings from non-leasehold land and property, while land and buildings which are offered for lease are taxed at 12.5% of revenues earned.
Mr Abhisit said the government would consider how to make tax collection fair to landholders. He added that tax waivers should be considered for low-income earners in need of accommodation, while progressive rates should be levelled against people who amass land plots but fail to put them to use.
The property tax would address unfair distribution of land, and it was the government's job to explain why it was a "must do" policy.
"Some people have numerous plots of land which are left unused while we are struggling to solve land problems for poor people. This is not fair."
Commenting on possible opposition from politicians who are big landowners, he said the tax scheme would only show the government was raising taxes for the common good.
Appointed senator MR Priyanandana Rangsit said the tax rises would burden land developers, which would eventually affect consumers.
However, Suriyasai Katasila, coordinator of the People's Alliance for Democracy (PAD), welcomed the tax proposals, saying property and inheritance taxes would lead to fairer distribution of land and help bridge the income gap between rich and poor.
Bangkok Post - 25.01.09
