THURSDAY, March 28, 2024
nationthailand

Tax relief proposed for SMEs hurt by wage rises

Tax relief proposed for SMEs hurt by wage rises

FINANCE Minister Apisak Tantivorawong has pledged additional tax deductions for small and medium-sized enterprises (SMEs) affected by the recent proposed increases in the minimum daily wage.

Apisak said yesterday that he would will propose a tax package to the Cabinet to assist those SMEs that could be hurt by the increases, which are, on average, 5 per cent above the previous minimum wage.
His comment came after business leaders complained about the government’s plan to raise minimum daily wage by between Bt5 and Bt22 – determined by costs in different areas – and criticism that the resulting higher production costs would disproportionately hurt smaller businesses.
Apisak said those SMEs with annual revenue of no more than Bt100 million would gain the tax deductions.
Companies would be able to write off their increased costs for daily wages at the rate of 1.15 times what they paid, he said.
The assistance would result in the government subsidising half the value of the wage increases. The minister cited the example of an SME operating in a province where the wage was raised by Bt22 a day; this company would gain a subsidy worth Bt11 per worker.
The wage rise proposal and the tax package will be submitted to the Cabinet for approval next week.
Industry Minister Uttama Savanayana will on January 29 discuss with the chairman of the Thai Chamber of Commerce and other representatives of the private sector other relief measures for those SMEs affected by the wage decision.
 Kobchai Sungsitthisawad, director-general of the Department of Industrial Promotion, expressed concerns over some 2.5 million SMEs in the trades and services – particularly in construction – that depend on workers covered by the minimum daily wage rates. Relief measures would be explored to help this group, the minister said.
Most of the country’s 400,000 or so SMEs in the manufacturing sector pay their workers at rates higher than the minimum wage.
The Ministry of Industry will apply nine measures already approved by the Cabinet to help this group of SMEs, with the assistance extended through 23 industry transformation centres and 270 centres set up to help SMEs upgrade higher standards. 
 

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