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 "We need to know the repurcussions of the tax cut, and if the cut would cure the problem. We can lower it now and raise it later, but Thailand actually cut VAT from 10 per cent to 7 per cent at the time of crisis," said Korn, deputy leader of Democrat Party.

 The Bank of Thailand suggested the government cut VAT to boost consumption as well as other unconventional measures.

 

 Prime Minister-elect Abhisit Vejjajiva also questioned if VAT, once cut, could be raised to the current level.

 Thailand cut VAT to 7 per cent in 1998 after the Tom Yam Kung crisis, and for years it has not succeeded in resuming the normal rate.

 However, Korn said there are various dimensions of solutions. In the short term, economic policies must address the economic downturn while in the long term competitiveness would be in the focus. Thailand also needs to review which tools would be the best -  fiscal policies, tax measures and budget spending. While tax cuts are possible, more budget spending should also help.

He noted that the economy would recover if the private sector regains its confidence. Thus, the government must assure the private sector that economic stability would be reinstated.

 

 Abhisit on Wednesday was meeting with business groups, to sound out their demands. After meetings with those who are tasked to boost farmers' spending power and tourism operators in the morning, he is scheduled to meet with industrial manufacturers in the afternoon.