Tax incentive to boost year-end shopping

Published ธันวาคม 30, 2015 by SoClaimon

ศาสตร์เกษตรดินปุ๋ย : ขอบคุณแหล่งข้อมูล : หนังสือพิมพ์ The Nation

http://www.nationmultimedia.com/politics/Tax-incentive-to-boost-year-end-shopping-30275730.html

 

Consumers spending during the final week of the year expected to jump by BT150 billion.

THE GOVERNMENT’S tax incentive for year-end shopping, which became effective yesterday, has boosted consumer interest at shopping centres nationwide, with combined spending expected to rise by Bt150 billion over the week until year-end.

Gross domestic product will expand further by an estimated 0.1-0.2 percentage points from 2.8 per cent, while the incentive for the seven-day period will cost the government an estimated Bt4 billion to Bt5 billion in tax revenue.

As well as a tax reduction on shopping valued up to Bt15,000 per person, the tax break covers domestic travel of the same value in the December 16-31 period.

More than 2 million middle- and high-income earners are expected to benefit from the measure with a tax saving of up to Bt750-Bt5,250 per person depending on their income-tax bracket.

“One of the current economic problems is that people who have money are reluctant to spend, and I believe that this measure will boost domestic consumption and tourism,” Finance Minister Apisak Tantivorawong said yesterday.

“We earlier introduced measures to help low-income earners, which are now adequate, while higher-income groups tend to shop and travel abroad. So this measure is considered a New Year gift for middle-income groups who will help support the economy,” he said.

Under the tax move to boost year-end shopping, a person whose personal-income-tax rate is 20 per cent will be entitled to a saving of Bt3,000 if he or she spends Bt15,000 during this period, while a person who pays 10 per cent in personal income tax will receive a Bt1,500 reduction in tax.

At present, the tax rates are 0 per cent for yearly earnings of Bt150,000 or less, and up to 35 per cent for yearly earnings of more than Bt4 million.

To qualify for the tax reduction, all transactions must be verified by a full value-added-tax invoice. That means providers of services or products that do not pay VAT are not applicable to this measure. In addition, alcohol, beer, wine, tobacco, cars, motorcycles, fuel, boats and gas use for automobiles are exempt as they are not subject to VAT.

A company worker in her 30s told The Nation that as soon as she heard the news about the Finance Ministry’s tax incentive, she went shopping at Central Bangna and bought contact lenses and cosmetics.

“This is a good and timely gift for people during the New Year. I hope they will accommodate people so we will get our tax refunds fast for this,” she said.

Consumers also need to ensure that they ask for full tax receipts for the goods bought. If one plans to take co-workers for a party at restaurant during this period, she said: “I will need to Google for qualified eateries for this plan. I don’t think a somtam stall near my office will count.”

The consumer mood at major shopping centres in Bangkok appears to have brightened after yesterday’s announcement of the tax break, with people wanting to go out and shop.

While some operators are ready to respond to the newly announced measure, some were not ready yet.

For example, some vendors said they could not issue full tax receipts right away because they had to get them from their head office. This means buyers will have to come back for full-form receipts at a later date.

For large department stores and shopping centres, preparedness is more obvious, as they clearly announced details of the tax break to urge shoppers to take advantage of the government’s move.

 

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