Government considering 50 year property leases for foreigners

The Finance Ministry is looking at current long-term lease laws and looking at ways to amend those laws to allow foreigners to lease residential property and land for 50 years instead of the current 30 years. The Finance Minister said that the land owners would still need to be Thai but they are considering amending the law to allow leaseholders to sell the leasehold on. The amendments are still under consideration but the Developer’s Association leaders think it is time to change the laws to boost the property market in Thailand.

The Cabinet approved the draft bill for land and property taxes with some small changes from the proposed Ministry of Finance bill. Those changes will see the tax rate for unused or vacant land at 2% for the base tax year subject to increase by 0.5 percentage points every three years until it is reaches at 5%. The change is aimed at encouraging land owners to use their property. The maximum rate for residential and agricultural land will be 0.2 percent and 2 percent for commercial properties. The tax will be on first homes and agricultural land valued at 50 million baht and more. Second homes will see a progressive rate starting at 0.03 percent to 0.3 percent. The taxes will be due every April with the first payments due in April 2019 if the law is enforced as planned.

The government is looking to invoke Section 44 to ensure that laws related to easing doing business in Thailand, including the Labor Protection Bill and the Social Security Bill, are enacted in time. The government is looking amend the e Civil and Commercial Code, the Labour Protection Act, the Social Security Act, Public Limited Companies Act and the Electronic Transactions Act before the World Bank’s Ease of Doing Business assessment in May. The changes are expected to allow business owners to register their business at any district nationwide rather than in the district where their business is located. Other changes that are expected to be seen made under Section 44 include eliminating requirements that companies must send working rules and regulations to the Labour Protection and Welfare Department while changes to the Social Security Act call for employers to make more contributions the pensions of employees 55 years and older. The Public Limited Companies Act changes will allow for a lower required proportion of shareholders when an extraordinary meeting is called, aimed at protecting small shareholders. The World Bank recently suggested that the Thai government consider removing the 25 percent paid up capital minimum currently required and to allow people to view land registrations.

Work Permit

Any foreigner working in Thailand must obtain a Work Permit before beginning work. While a prospective employer may file an application on the foreigner’s behalf in advance of his starting work, the actual Work Permit will not be issued until the foreigner has entered Thailand in accordance with the immigration laws and has presented himself to receive his Work Permit.

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