Government promotes home ownership at the expense of revenue collections
Thailand has approved a measure temporarily reducing both housing transfer and mortgage fees for 12 months, the Bangkok Post has learned.
Housing transfer and mortgage fees will be set at a rate of 0.01 percent, down from two percent and one percent, respectively. The rates, applicable on units worth THB1 million (USD31,460) each, will be in effect until 31 May 2020.
The announcement comes on the heels of a measure offering tax deductions of up to THB200,000 for purchases of homes and condos worth up to THB5 million.
The fee cuts are intended to promote home ownership among low- and middle-income earners in the kingdom.
Around 58,340 families or 175,020 individuals are expected to benefit from the measure, according to estimates by the Post.
Around 2.87 million families in Thailand, representing low- and middle-income earners, do not own their homes, reported Nathporn Chatusripitak, spokesman for Deputy Prime Minister Somkid Jatusripitak.
The government expects the measure to revive a domestic market ridden with a surfeit of condos and homes worth less than THB1 million. However, the fee cuts could cost the government THB1.7 billion in revenue losses.
Thailand recently announced stimulus measures worth THB21.83 billion, of which THB13.2 billion will be spent on public welfare benefits for low-income earners.
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