The relationship between the land and buildings Tax Act, B.E. 2562 (A.D. 2019), and the land use and land cover (LULC) of Bangkok, Thailand

Abstract

The Land and Buildings Tax Act, B.E. 2562 (A.D. 2019), was enacted in Thailand with the aim of wealth distribution, revenue increase, and discouraging unproductive land use. However, since its implementation in 2020, in Bangkok, a notable increase in land use and land cover (LULC) changes, specifically vacant lands being converted to agricultural lands, has been observed. These changes are hypothesized to be related to tax avoidance activities. This study aims to investigate the phenomenon of vacant-to-agricultural land conversions in Bangkok and employ spatial analysis techniques to identify and locate these LULC changes.

By employing a statistical t-test and conducting key informant interviews, this research shows that the implementation of the new property tax policy is likely contributing to these land use changes. Additionally, remote sensing and geospatial analyses are performed on ESRI LULC maps and Google platform images from 2018, 2019, 2020, and 2021, reveal that: (1) the majority of LULC changes and suspected tax avoidance activities occur in the urban fringes, (2) there is a clustering of suspected tax avoidance activities, particularly in the eastern fringe of the city, while the urban core exhibits minimal such activities, and (3) the clusters of high or low suspected tax avoidance activities demonstrate interrelatedness.

The employed research techniques and the results have implications for the administration of the new property tax policy, as well as for wealth redistribution, urban service provision, and peri-urban dynamics in the city. In addition, the study suggests the improvement of property tax management by providing specific guidelines accompanying the law and fostering the co-creation of urban services and infrastructure.