The cabinet approves cutting both housing transfer and mortgage fees to spur buying. (Bangkok Post photo)

The cabinet has approved cutting both housing transfer and mortgage fees to 0.01% for 12 months, aiming to spur buying after critics said the previous measure to offer tax deductions of up to 200,000 baht for buyers of homes and condos worth up to 5 million baht would have a minimal impact on the market.

The fee cuts from 2% and 1%, respectively, will come into force after publication in the Royal Gazette and will run until May 31, 2020.

The government is projected to lose 1.7 billion baht in revenue from the latest measure, which will apply to low- and middle-income earners who purchase houses or condos of up to 1 million baht a unit.

Nathporn Chatusripitak, spokesman for Deputy Prime Minister Somkid Jatusripitak, said on Tuesdaythere are 2.87 million families that are low- and middle-income households and have yet to own their own home.

The measure is expected to help 58,340 families own their own houses, helping 175,020 people.

The measure will also help stimulate the domestic property business, Mr Nathporn said, adding that there is a glut of houses and condos on the market worth less than 1 million baht.

Last month, the cabinet approved offering tax deductions of up to 200,000 baht for buyers of homes and condos worth up to 5 million baht. The measure is part of new stimulus measures worth 21.83 billion baht.

The stimulus package includes spending of 13.2 billion baht on public welfare benefits for low-income earners, plus tax measures worth 8.62 billion baht.

The cabinet yesterday also banned the import of second-hand cars, aiming to reduce environmental harm.

The Commerce Ministry will announce the ban of used vehicles, including buses, pickups, passenger cars and tractors. Ambulances and locomotives are exempt from the ban.