Property tax incentives extended 2 more months

Thai Real Estate Association president Kittipol Pramoj na Ayudhya said his organisation and the Thai Bankers' Association had submitted a letter to Prime Minister Abhisit Vejjajiva on Sunday, asking for the extension.

Before yesterday's decision, the number of transactions had skyrocketed this month ahead of the end of the incentives, overwhelming the limited number of officials at the Lands Department.

Banks have also received a flood of loan applications, which they could not process as quickly as demanded.

In their letter, the associations also said traffic congestion as a result of the ongoing red-shirt political rally had also limited the travelling convenience of home-buyers. Kittipol said as many as 40,000 home-buyers in Bangkok were still waiting to complete transfers this month.

"The extension means greater convenience and will benefit more home-buyers, particularly those deciding whether to buy a house now for fear of inability to reap benefits from the tax incentives," he said.

Kittipol expects 10-per-cent growth in the industry's sales revenue this year, thanks to the incentives, which offset negative factors brought about by the political conflict.

The Cabinet yesterday endorsed a two-month extension of the tax incentives after earlier denying one on grounds that companies had already benefited hugely from the incentives.

It is estimated that for every Bt1 million in the price of a house, a buyer's cost will rise Bt20,000 once the incentives end. The transfer and mortgage-registration fee is now 0.01 per cent and will return to 2 per cent after two more months, while the special business tax will rise from 0.11 per cent to 3 per cent.