Tax collection 6.6% below nine-month target

Economy July 19, 2014 00:00

By The Nation

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The net state tax collections for the first nine months of fiscal year 2014 (October 2013 to June 2014) amounted to Bt1.55 trillion, 6.6 per cent (or Bt110.24 billion) below target because of the sluggish domestic economy and slow international trade.

Krisada Chinavicharana, director of the Fiscal Policy Office, said the shortfall was attributed to the take by the three collection agencies under the Finance Ministry being 9.1 per cent (Bt162.35 billion) lower than expected. However, tax revenue contributed by state enterprises and other agencies was higher than expected at Bt26.02 billion and Bt14.51 billion, up by 27.8 and 17.3 per cent respectively. 
The lower revenue from value added tax (VAT) and import duties was in line with the higher-than-expected contraction of import value, coupled with lower corporate tax revenue due to the sluggish Thai economy. That resulted in a higher-than-expected contraction of private-sector operational results, which translated into lower corporate tax revenue for fiscal year 2013.  
Other factors contributing to the lower tax revenue were the below-target income from vehicle excise tax and fuel levies, which was in line with the sharp decline in auto sales as well as the extension of the diesel-fuel tax cut, Krisada said. 
However, tax revenue should rise as the economy and tax-collection efficiency improve in the remaining period of this fiscal year, he said. 
In June, net tax collections amounted to Bt192.78 billion, below the target by 8 per cent (Bt16.77 billion), but higher than in the same month last year by 5.3 per cent. Tax collection by the three state agencies was 8.3 per cent (Bt19.63 billion) below target. 
Targets shortfalls were seen in VAT, which was 16.4 per cent (Bt11.26 billion) less than projected, attributed to 7.7 per cent (Bt6.53 billion) lower import value, and in corporate tax. 
The vehicle excise tax was 47.5 per cent (Bt5.66 billion) short of target as domestic demand contracted. Fuel tax fell short by Bt2.59 billion (35.3 per cent), import duties by Bt2.38 billion (22.1 per cent), and tobacco excise by Bt1.16 billion (17.6 per cent) in line with the weaker domestic demand and lower import value. 
Tax revenue from petroleum was 556.2 per cent (Bt13.07 billion) higher than expected because the tax-payment deadline coincided with a civil-service holiday, resulting in overlapping of some portion of May tax revenue.