The Centre for Economic Situation Administration (Cesa) on Wednesday approved a proposal to offer taxpayers income tax deductions of up to 30,000 baht for purchasing products and services with a 7% value-added tax (VAT), in another bid to boost domestic consumption.
Effective from 23rd October 2020 until 31st December 2020, the tax deduction offer will apply to the 2020 tax year and is projected to inject about 120 billion baht into the country’s economy, said Danucha Pichayanan, deputy secretary-general of the National Economic and Social Development Council.
About 4 million people are expected to take advantage of the programme, which, however, will cost the state about 12 billion baht in missing tax revenue, he said.
All types of products and services with VAT will be included into the tax deduction programme, except for alcoholic beverages, tobacco products, government lotteries, fuel, accommodation services and air tickets, he said.
Only people who have not signed up for any of the two existing consumption boosting programmes are eligible to apply for the new tax deduction programme, he said.
The two programmes are the provision of 1,500 baht in living allowances to each holder of the state welfare card for spending in three months and the government’s offer to pay half the amount an individual spends on consumer products, for no more than 3,000 baht per person in three months.
The Cesa also approved adjustments to existing local tourism promotion and benefits being offered to healthcare workers.
Both projects will be extended to 31st January 2021, Mr Pichayanan said.
Those taking part in the domestic tourism promotion programme will stay at hotels in their provinces and be allowed to use e-vouchers given to them to pay for food, for entrance fees at tourist attractions and for buying Otop products in the same province, he said.
He said 570 officials at Bangkok health centres and 2,615 more health promotion officers in other provinces will be included in the project offering health workers tourism benefits as a reward for their hard work during the COVID-19 outbreak, he said.
Deputy Prime Minister and Energy Minister Supattanapong Punmeechaow said the government plans to inject 63 billion baht through these three economic stimulus programmes and expects to see up to 200 billion baht circulating in the economy in the last quarter.
At Wednesday’s meeting, the Cesa included a proposal to attract more foreign investors and tourists through various measures, namely a so-called “Special Tourist Visa (STV)” programme, the Board of Investment of Thailand’s (BOI) measures to attract foreign experts to come to Thailand, and an idea to allow Thailand Elite Card holders to invest more in properties, he said.
The proposed measures and ideas have not been finalised, Mr Punmeechaow said.
As for a proposal to begin reopening the country to investors and tourists, the Cesa will resume discussing them on Friday, he said.
Prime Minister Prayut Chan-o-cha, meanwhile, emphasised that the proposed partial reopening will likely be piloted with visitors in certain areas of the country.
The economic impact of the COVID-19 pandemic on the country, especially on the tourism and hotel sectors, is being treated as an urgent problem and the government is talking with all parties to find out to what extent they would agree to the re-opening proposal as a means of easing the impact, he said.
In Phuket, for instance, Gen Chan-o-cha said, the pilot reopening project will likely begin some time after 25th October, the end of the resort island’s vegetarian festival.
Details as to who will be allowed in are still being discussed, he said.
Asked if the COVID-19 situation in neighbouring countries, such as Myanmar and Malaysia, was treated as a factor in the government’s decision to approve the reopening proposal, Gen Chan-o-cha said visitors allowed into Thailand will stay at specially designated places.
Napintorn Srisunpang, an assistant to Tourism and Sports Minister Phiphat Ratchakitprakarn, said many people had applied for the STVs.