Cabinet approves 7 tax measures

 Prime Minister's Office Minister Sathit Wongnongtoey said on Tuesday that the retroactive measures are effect on January 1, 2009.

The Cabinet has approved seven tax measures to boost the economy, expecting the measures to lead to a loss of tax revenue of Bt10 billion per year.

 Prime Minister's Office Minister Sathit Wongnongtoey said on Tuesday that the retroactive measures are effect on January 1, 2009.

The measures are as follow;

1. Individuals or a group of individuals without fixed income will be taxed Bt5,000 per annum, for the income higher than Bt1 million. Earlier, they were subjected to Bt300 tax, for minimum income of Bt60,000.

 2. Those who buy houses this year are eligible to deduct taxable income with Bt300,000 of principle and Bt100,000 of interest.

 3. Tax privileges to venture capital funds which invest in small and medium-sized enterprises would also be extended for another 3 years to 2011. The privileges were expired at end-2008.

 4. Tax privileges on the retructuring of debts incurred from mergers and acquistions will be extended by another year.

 5. Companies which are hosting seminars at domestic tourist destinations can deduct its corporate taxable income twice the value of the expenses.

 6. Households will be waived from water and electricity charges if their water and electricity consumption does not exceed 60 units and 90 units per month. 

7. The government will also intervene the prices of five main agricultural products - rice, tapioca, rubber, corn and palm.

Stock Exchange of Thailand Chairman Pakorn Malakul Na Ayudhya commented that the second-round package is the best thing that the government can do under limitations.

"The economic crisis is a huge problem that calls for cooperation of all. It's not solely upto the government but the private sector must also lend help," he said, adding that the exchange's executives would join the government in international roadshows.

Wisit Tantisunthorn, secretary-general of the Government Pension Fund, noted that the package has two main objectives - lowering the cost of living and boosting the purchasing power. Yet, consumption would resume only when consumers regain confidence in economy, or they would prefer saving.

Meanwhile, the higher tax deductions from property purchases are better than nothing, he said.