Thursday, September 19, 2019

More stimulus for smaller  cities on way

Apr 18. 2019
Ekniti Nitithanprapas
Ekniti Nitithanprapas
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By THE NATION

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THE Revenue Department is readying its latest iteration of a stimulus package aimed at promoting domestic tourism to secondary cities through tax deductions on purchases.

 

Visitors to these can qualify for the deductions on purchases to a maximum of Bt15,000 for each claimant.

The department is set to hand over the package for review by Deputy Prime Minister Somkid Jatusripitak, in the hope of propping up the economy in the second and third quarters of this year.

Revenue director-general Ekniti Nitithanprapas said that the department agreed with the Ministry of Tourism and Sports, which had urged the department to promote tourism in secondary cities through tax support measures.

Such measures have been done before and the department is reviewing possible impacts on its tax collection through the annual personal income tax submission, which had been scheduled to end in March.

So far, the measures may not have much effect on the tax collection but, from the economic perspective, they could lead to more income distribution in the targeted cities, Ekniti said.

“In the economic view of the secondary cities, we expect this measure to help distribute income,” he said. “It’s the economic opportunity. Meanwhile, in principle, a specific period must be determined. Otherwise, people will wait for travel or spend late in the period. We expect to use this measure in the second and third quarters of the year, given the last quarter is the main tourism season.”

The spending under the Bt15,000 cap will be used as a tax deduction in the 2019 tax year, he said.

An anonymous source from the Ministry of Finance said that Somkid yesterday met with ministry officials to discuss economic stimulus and the prospects for the economy in the second and third quarters. It is expected to down amid the political vacuum.

“This year, the economy is expected to slow down compared with the previous year,” the source said. “The growth is estimated at 3.8-3.9 per cent and some research houses predict it come in lower than 3.5 per cent due to estimated lower-than-targeted exports as a result of the global economy. This is combined with the Thai political situation. Although an election took place, the outlook for the formation of the new government is not smooth and this has affected investors’ confidence.

“Therefore, it’s necessary for Ministry of Finance to propose short-term economic measures.”

 

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