The Nation

business

Smaller
Larger

Tax incentives for importers hitting customs

Up to 80 per cent of imports now take advantage of tax incentives, which results in a heavy impact on government revenue, the Customs Department says.

"Importer requests for tax incentives in the Asean free-trade zone have increased considerably and account for 70-80 per cent of the total import amount. This has lowered the expected tax income by 14 per cent in the first two months of the 2014 fiscal budget year," said Rakop Srisupaat, director-general of the department.

He estimated that customs income would continue to decrease as tax incentives increase and stricter regulations target certain products such as automobiles. The import ban on reassembled luxury cars, which have high tariffs, is one factor that has decreased the collection of taxes from importers.

Recent decreases in imports are not yet significant but are on a downward trend that is largely dependent on the effect of the political situation on the economy. If the government has to delay its plans for infrastructure projects, it will stunt the growth of the private sector, which will lead to a decrease in the import sector.

"In the past, the use of tax incentives was considered minor, at 20 per cent of the total import amount, but at present this ratio has noticeably increased because of the competitiveness in the import sector. The need for tax incentives is derived from the need to lower costs because of this competitiveness," Rakop said.

"The most requests for tax pardons are from operators in the automobile industry," he added.


Comments conditions

Users are solely responsible for their comments.We reserve the right to remove any comment and revoke posting rights for any reason withou prior notice.