THE PAVILIONS PHUKET BRITISH INTERNATIONAL SCHOOL, PHUKET Kata Rocks
Login | Create Account Poll Currency Weather Facebook Youtube Search

VAT refund has academic ‘speechless’

BANGKOK: Thailand Development Research Institute (TDRI) academics have expressed dismay at the Finance Ministry’s plan to grant a 5% value-added tax (VAT) refund to shoppers spending up to B20,000 from Feb 1-15 next year.

economicspolitics
By Bangkok Post

Tuesday 4 December 2018, 10:13AM


Nipon Poapongsakorn, a top analyst at the Thailand Development Research Institute says flatly the only reason for a 5% holiday VAT refund is to gain ’favourable benefits [for some political camps] ahead of the election’. Photo: Bangkok Post

Nipon Poapongsakorn, a top analyst at the Thailand Development Research Institute says flatly the only reason for a 5% holiday VAT refund is to gain ’favourable benefits [for some political camps] ahead of the election’. Photo: Bangkok Post

“I am speechless about it,” said Nipon Poapongsakorn, a distinguished fellow of the TDRI.

VAT was first introduced in 1992 at a rate of 10%, but was slashed to 7% in late 1997 at the private sector’s request. The rate has been kept at 7% ever since.

The ministry’s claims that the measure is needed to stimulate the economy are unsound since the current situation is not bad, he said, adding that the National Economic and Social Development Board and Bank of Thailand indicate the economy is projected to grow by more than 4% this year.

“The ministry should roll out lavish measures only when crises come,” said Mr Nipon.

“I can see only one reason. It will give favourable benefits [for some political camps] ahead of the election,” he said.

He also urged the ministry to explain how it would offset VAT losses and asked the ministry to adhere to fiscal discipline.

“Even though the measure might create happiness today, it could foster hardship in the future,” said Mr Nipon. “I also do not think this measure will be the last. It is likely that the government and the Finance Ministry will roll out further measures as the election draws nearer.”

Shoppers eligible for the VAT refund must have made their purchases with debit cards linked to PromptPay.

The VAT refund window coincides with Chinese New Year, which falls on Feb 5 next year.

Somchai Jitsuchon, another academic at the TDRI, said the measure should only be applied to low-income earners who hold welfare cards.

QSI International School Phuket

“The return [of VAT] to debit card holders without knowing levels of their income would mean that middle- and high-income earners would also be entitled,” said Mr Somchai.

The measure is one of a raft of so-called “stimulus” initiatives unveiled by the administration, which critics say are designed to give the upper hand to pro-regime parties prior to the election tentatively set for Feb 24 next year.

Another concern is the distribution of mobile phone SIM cards with free internet access to welfare card holders.

Takorn Tantasith, secretary-general of the National Broadcasting and Telecommunications Commission (NBTC), said his agency and the Finance Ministry are discussing how the measure would take shape in practice.

The NBTC, he said, proposed that instead of handing out SIM cards, the government could add money to the SIM cards low-income earners already have or deliver top-up cards to them.

It is likely that they would receive assistance worth B50 a month, he said, adding the approach would be proposed to the NBTC board by this month.

NBTC Deputy Secretary-General Korkij Danchaivichit meanwhile conceded there are some concerns, including how to ensure the top-up cards would really only be used by low-income earners.

 

Read original story here.

 

 

Comment on this story

* Please login to comment. If you do not have an account please register below by simply entering a username, password and email address. You can still leave your comment below at the same time.

Comments Here:
Comments Left:
# Characters
Username:
Password:
E-mail:
Security:

Foot | 05 December 2018 - 07:56:23

“...The ministry should roll out lavish measures only when crises come,” said Mr Nipon..."
I guess the huge decline in free spending western and Chinese tourists isn't considered a problem.

CaptainJack69 | 04 December 2018 - 21:44:45

Thaksin was the only Prime Minister in Thailands' history to ever win re-election and still to this day (despite being a convicted criminal living in exile) retains huge political followings, mainly among the rural poor.  How did he do it? By handing out huge quantities of free rice paid for from his own personal fortune, that's how. This kind of bribery of the poor masses wins elections.

Discover Thainess | 04 December 2018 - 11:27:36

Someone who knows what he is talking about - I like him a lot.

Have a news tip-off? Click here

 

Phuket community
Phuket tour bus oil leak fells motorcyclists

Poor driver, because his boss, the bus owner, didn't do proper maintenance checks, he has to tak...(Read More)


18 million meth pills seized in Chiang Rai

All fine PR, but I am waiting to read that drugs factories are destroyed, that the very top thai Hi-...(Read More)


Patong, Karon to be hit by water-supply outage throughout Christmas

Is this a joke? Or kind of negative tourist promotion during the Christmas Days. Something like: Don...(Read More)


Hunt for Phuket oil spill perpetrator underway

Why is it that always a Governor has to 'order' or to call on Department Chiefs to do their ...(Read More)


Doomed ‘Phoenix’ substandard: international experts

Well, the outcome of the international investigation asks for 1 important 'order' from Bangk...(Read More)


Doomed ‘Phoenix’ substandard: international experts

Every singel boats in phuket are built in a back yard, not a single tourist boat is built by any tha...(Read More)


Doomed ‘Phoenix’ substandard: international experts

So how many other substandard boats are out there? If there is one there are certainly plenty or oth...(Read More)


Hunt for Phuket oil spill perpetrator underway

Meh - the oil-ladened water is more sanitary than the stuff that isn't....(Read More)


Property owners to be targetted as fake goods raids hit Patong, Central

So, is the manager of Phuket Central Festival 'falling' under any thai act to arrest/fine hi...(Read More)


Phuket’s bypass roadworks to complete before New Year

The surface was fine and could easily have waited a couple of months until the roads (and everywhere...(Read More)