Thai Government Begins Strict Enforcement of Agricultural Land Tax Planning Measures

The current version of the Land and Building Tax Act B.E. 2562 (2019) (“Land and Building Tax Act”) came into force in 2019, and land and building taxes first were collected in 2020. During the initial phase, reduced tax rates applied. The Act classifies land or buildings into four categories for tax collection purposes, pursuant to Section 37 of the Land and Building Tax Act:
(1) land or buildings used for agricultural purposes;
(2) land or buildings used for residential purposes;
(3) land or buildings used for purposes other than those in items (1) or (2); and
(4) land or buildings left vacant, or not put to beneficial use, as appropriate based on their condition.

Since promulgation of the Land and Building Tax Act, many plots of land that previously were left idle and overgrown with tall grass have been planted neatly, with banana trees or other plants. This is because the landowners wish to minimize their taxes by converting vacant or unused land—which is subject to the highest land tax rate (up to 1.2% of the tax basis)—into agricultural land, which is subject to the lowest tax rate (not more than 0.15%). However, if the land is left vacant for more than three consecutive years, the tax rate will increase by an additional 0.3% for every three-year period (subject to a maximum ceiling of 3%) in accordance with Sections 37 and 43 of the Land and Building Tax Act.

The Royal Decree Prescribing Land and Building Tax Rates B.E. 2564 (2021) establishes the criteria for determining the tax basis applicable to agricultural land and to land or buildings that are not put to use, as follows:

In fact, the use of land for agricultural purposes is not limited solely to cultivation of specified crops. It also includes livestock farming, the breeding of insects for economic purposes, and aquaculture, in accordance with the conditions and criteria established by law.^*1 That said, if owners of idle or vacant land and buildings do not genuinely intend to engage in agriculture, but merely wish to satisfy the criteria for the land to qualify as agricultural land in order to reduce their tax burdens, they often choose to adapt the area for crop cultivation, as this appears to require the least maintenance. Therefore, it is common to see prime plots in major urban areas being used for casual or scattered planting, with sparse trees and without any real intent to engage in serious agricultural activities. For example, banana, mango, and lime trees frequently are planted on urban land.

In 2025, the Ministry of Finance and the Ministry of the Interior issued the Notification Re: Criteria for the Use of Land for Agricultural Purposes (No. 3), which has been effective since 1 January 2025. The authorities also circulated official notices to inform relevant government agencies of this Notification, for purposes of tax collection for the 2025 tax year (payable in 2026). This Notification revises certain minimum density requirements, most recently, by increasing the minimum number of eucalyptus trees from 35 trees/rai^*2 to 100 trees/rai. Taxpayers who wish to reduce their land taxes must plant crops in accordance with the minimum density set out in the schedule—which covers a total of 57 categories—in order for the land to qualify as being used for agricultural purposes.

If crops are grown that are not listed on the schedule, the required planting density may be determined by comparison with the type and size of crops that are most similar to those specified in the schedule. 

Although no measures are currently in place to reduce tax rates on agricultural land, tax relief measures remain available only for residential land and buildings or certain designated projects.^*3 Due to the numerous natural disasters and incidents of unrest Thailand experienced during the past year, such as flooding and other disturbances, the deadlines for procedures relating to this tax have been extended by an additional two months, for both authorities and taxpayers.^*4 For example:

• the date for issuance of assessment notices to taxpayers has been extended from February 2026 to before the end of April 2026;
• the deadline for payment of taxes in accordance with assessment notices has been extended from April 2026 to before the end of June 2026.

Nevertheless, the commencement of full tax collection from the 2025 tax year onward may lead many landowners to consider and undertake additional agricultural activities in order for their land to qualify as agricultural land, thereby reducing their tax burdens through lower applicable tax rates. However, the current criteria and conditions in Thailand, which require only compliance with minimum planting or livestock thresholds, remain less stringent than those imposed under the laws of certain foreign jurisdictions. For example, in the United States, there are stricter requirements to substantiate the status of land for which agricultural tax benefits are sought, such as a requirement that the land must be used for agricultural activities for at least two years before tax relief may be claimed.^*5 The author believes that future development and enforcement of Thailand’s land tax laws will become more serious and rigorous from 2026 onward. For instance, officials are expected to conduct more frequent site inspections to assess taxes based on the actual use of land, to ensure that land is used efficiently and that taxes are assessed and collected accurately and in full, in accordance with the legislative objectives of the Act.

This article is intended to provide only a regulatory overview, and is not intended to be comprehensive or to constitute legal advice. If you have any questions on this or on other areas of tax law, please do not hesitate to contact our Tax Team at SCL Nishimura & Asahi Limited.

Budhima Kerdsiri
Counsel

Hatairat Sukprasert
Associate

• Notification of the Ministry of Finance and the Ministry of Interior Re: Criteria for the Use of Land for Agricultural Purposes, dated 30 January B.E. 2563 (2020)
• 1 rai equals 1,600 square meters
• Royal Decree on the Reduction of Land and Building Tax B.E. 2563 (2020) and Royal Decree on the Reduction of Land and Building Tax (No. 2) B.E. 2567 (2024)
• Notification of the Ministry of Interior Re: Extension of Time Limits for Implementation under the Land and Building Tax Act B.E. 2562 (2019) for the Year B.E. 2569 (2026)
• Division of Taxation of The State of New Jersey (2025, August 12), Farmland Assessment, Available at: https://www.nj.gov/treasury/taxation/lpt/lpt-farmland.shtml (Accessed 10 February 2026)

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