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Published on January 9, 2008

December's receipts of Bt93.21 billion were 5.6 per cent below budget, Finance Ministry spokes-man Somchai Sujjapongse said yesterday.

The shortfall was caused largely by car buyers waiting for the excise-duty cut for vehicles capable of using alternative fuels, he said.

New cars that can run on E20, or petrol mixed 20 per cent with ethanol, will enjoy a 5-per-cent excise cut starting this month.

Excise collected for cars fell short of expectations by 27.7 per cent.

The Revenue Department's total tax collections rose to Bt71.73 billion, or 1 per cent higher than forecast.

Corporate income tax was 16 per cent above projections largely due to multinational firms repatriating profits.

Value-added tax was running 1.7 per cent behind target but its rate of fall was slowing, suggesting a recovery in the economy, Somchai said.

The Customs Department collected Bt7.9 billion, 1.2 per cent better than estimated, thanks partly to hefty imports.

Net government revenue for the first quarter of the fiscal year, which started in October, rose 8 per cent on year to Bt324.95 billion, or 0.8 per cent higher than projected.

Somchai is optimistic the ministry will meet its fiscal 2007 revenue target of Bt1.495 trillion, against expenditures set at Bt1.66 trillion.

The new government could increase mid-year spending by lifting the budget deficit from 1.8 per cent of gross domestic product to 3 per cent, but only if investment and consumption do not pick up, he said.

The economy's prospects look good for this year, but face challenges from political uncertainty, high oil prices, a global slowdown and exchange-rate volatility, he added.

Wichit Chaitrong, The Nation