THE government is considering the reintroduction of a year-end retail stimulus scheme that enables shoppers to enjoy tax deductions on purchases.
The initiative is aimed at coaxing consumers to spend more and help boost economic growth.
Prime Minister Prayut Chan-o-cha said, after chairing a Cabinet meeting yesterday, that the Ministry of Finance had been tasked with reviewing the annual tax incentives for year-end shopping with a view to extending the eligibility period.
“The shopping tax incentive was offered in 2015 and 2016. This year, more study is needed into the details of the scheme and the possibility of a longer period for the tax break,” Prayut said.
Last year, the government allowed Thais a tax deduction of up to Bt15,000 on goods they bought from December 14-31.
Prayut said that several macroeconomic factors, including an increase in exports, had enabled the people to gain direct benefits from improved economic indicators.
“Enterprises that employ a total of about 10 million people have so far gained from the improving economy, and the broad uplift in economic activities has also benefited the Thai economy,” he said.
Meanwhile, the price of rubber has remained low in line with the market mechanism, Prayut said, adding that the increased use of synthetic rubber is a factor as its price has fallen as a result of the decline in global crude oil prices.
Among solutions to this problem is to have rubber fit domestic demand without resulting in oversupply, the Prime Minister said. The government was now promoting the use of domestic rubber in automobile tyre production and in plant expansion, he said.
Prayut was satisfied with the latest movements in the Manufacturing Production Index, which rose 4.2 per cent year on year in September, said Nattaporn Jatusripitak, an adviser to the Prime Minister’s Office.
This marked a third straight month of increases.
Last month, the index rose 4.2 per cent year on year.
The rises reflected the uplift in Thai economic growth, which has spurred production in the manufacturing sector, Nattaporn said.
The Centre for Economic and Business Forecasting of the University of Thai Chamber of Commerce forecasts the country’s economy will grow by up to 3.8 per cent this year and by 4 per cent in year 2018, the centre’s director Thanawat Polvichai said yesterday.
He cited the recovery in the global and domestic economies for the forecasts.
Thanawat said that purchasing power had also been rising. This will boost consumer spending for the rest of this year.
For the Loi Krathong festival on November 3, the centre estimates that spending nationwide could top Bt9.9 billion, up 3 per cent from last year.
According to a survey, some 92.9 per cent of respondents said they planned to take part in the festival, he said.