The Revenue Department is planning to implement new tax deduction mechanisms for property buyers. This plan forms part of a seven-point program to drive economic growth in Thailand as the country transcends to a new government.
According to Ekniti Nitithanprapas, director-general of the Revenue Department, tax measures for property buyers were originally proposed by the Fiscal Policy Office (FPO).
The Finance Ministry added that this “economic stimulus package” with a seven-point agenda is worth a combined 20 billion baht. In two weeks’ time, the bill will undergo cabinet discussions and the approval process.
The proposed tax deduction will, among others, the following areas:
(1) domestic tourism spending of up to 15,000 baht
(2) uniform purchase
(3) sports equipment
(4) student textbooks for students
(5) subsidy for welfare smartcard holders (i.e. assistance for elderly care)
(6) property tax cuts to increase demand for Thai property
Also being considered are cash giveaways (1,500 baht each) so that constituents can pay for tourism products and services.
Those studying in fields that fall under 10 key industries will have the privilege to avail of a Student Loan Fund. This program aims to “enhance workforce development in the long run” according to an article in the Bangkok Post.
Book purchases can also be subject to tax deductions. Moreover, should the proposed bill pass into law, operators can now claim investment (up to 2 times) as an expense in point-of-sale terminals and deduct from their taxable income.
Finance Minister Apisak Tantivorawong recently shared why it is necessary for the Finance Ministry to propose stimulus measures. He said Thailand’s GDP growth in the first 6 months of 2019 will be just a little above 3 per cent. Should the economy slow down and grow below 3 per cent, the government may need to shell out an enormous amount of resources.
Experts say the Thai economy is losing traction. In addition to local political issues, the trade war between the United States and China has likewise affected Thailand’s international trade activities.
Researchers, analysts and policymakers predict a 2019 GDP growth of 3.8 to 3.9 per cent. More pessimistic forecasts point out to GDP levels lower than 3.5 per cent – which can be alarming if proven to hold water.