Tax incentive offer to shoppers please retailers
Modern retailers have welcomed the government’s proposed measure to grant individual shoppers a tax deduction of up to Bt30,000 in order to stimulate spending in the local shopping industry. The measure is expected to be approved by the Cabinet next week.
The government will next year also issue bonds worth Bt100 billion to raise funds to distribute directly to 18 provinces throughout the Kingdom for their economic and social development. The move is aimed at boosting liquidity and spending power in the local economic system.
Attractive promotions and events have been launched to entice higher spending by shoppers during the festive year-end period, especially for gifts and hampers.
Nattakit Tangpoonsinthana, executive vice president for marketing, Central Pattana Plc (CPN), the operator of CentralPlaza, CentralFestival, and CentralWorld shopping malls, said the government has been in power for a while now and it understands the current economic situation.
“The government has launched economic stimulus measures continuously, specifically in each quarter. The tax-breaks will pave the way for more optimism in shopping sentiment and for the overall economy. It will encourage local shoppers to buy domestically,” he said.
Nattakit said the company, which manages 30 shopping centres in the Kingdom, expected higher sales at its malls by 20 to 30 per cent by the end of this year, driven by the government’s shopping incentive.
“We are set to open three new shopping centres next year – in Mahachai at the beginning of the third quarter, in Nakhon Ratchasima in September, and at the end of the year in Phuket,” he said.
CPN yesterday announced it was joining hands with MasterCard, Thai Life Card, and The 1 Card, to invite all Thais to enjoy a simple countdown to the New Year by sharing joy and solidarity in a Bt300-million campaign called “Lighten Up Together”.
More than 10 million decorative lights will embellish all of CPN’s shopping centres. It will also host Southeast Asia’s largest gift festival to be held from December 10 to January 15 at CentralWorld and also at 30 branches of CentralPlaza and CentralFestival nationwide.
Chamnarn Maytaprechakul, executive vice president of The Mall Group, said the shopping tax incentive was great for the country’s economy and retail industry, as it would boost consumer spending.
“A similar tax incentive by government last year helped stimulate year-end spending and The Mall Group saw sales surge by 20 per cent in the first seven days of the incentive being announced. If there are more of these incentives, as suggested by the Finance Ministry, then the economy will get a boost,” he said.
The Mall Group has offered more promotions to attract customers as a result of the shopping tax breaks. The company also said it could process tax forms efficiently to meet consumers needs. Product categories most customers are expected to spend on include gift hampers, fashion, cosmetics, electronics and consumables at Home Fresh Mart and Gourmet Market.
Sompong Rungnirattisai, commercial director at Tesco Lotus, said that Tesco Lotus would welcome the government’s tax incentive shopping programme, as it would lift overall consumer sentiment and have a positive impact on consumer spending.
“Whether this year’s programme lasts 15 days or 30 days, Tesco Lotus will be ready to serve our customers by issuing the necessary documentation for tax rebate,” he said.
“The tax programme will coincide with our ‘United Hearts’ campaign to help customers with the cost of living. Under this campaign, four streams of activities will introduce unprecedented price reductions across Tesco Lotus stores. Our permanently low prices will continue across key product categories namely fresh food, rice, snacks, and mum and baby products. This will be supported by weekly and monthly promotions offering further discounts and offers such as ‘Buy 1 Get 1 Free’. Seasonal products like gift baskets, gift sets and confectionery will also be available at great prices,” he said.
“Lastly, the United Hearts campaign will offer discounts of 20 per cent or higher on more than 700 products such as detergents, personal care products, food and beverages. This part of the campaign is a collaboration between Tesco Lotus and 14 leading FMCG companies in Thailand in a joint investment worth more than Bt200 million,” he said.
“The aim of the United Hearts campaign is to help alleviate the burden our customers face, as our own surveys have found that a large number of Thais are concerned about the cost of living. The campaign, coupled with the government’s tax initiative, should help to stimulate spending and uplift Thai spirits,” he added.
