Satit Rungkasiri said the reduced revenue could be compensated by other categories of tax including the value added tax (VAT).
Personal income tax will be adjusted from the ceiling of 37 per cent to 35 per cent, to be effective in the 2013 tax payment year, he said, adding that tax collection was higher than the 25 per cent target.
“We are concerned about decreasing revenue from last year’s reduction of corporate tax from 30 per cent to 23 per cent, and this year’s further reduction from 23 per cent to 20 per cent,” he said.
Reducing the corporate income tax has, however, expanded the tax payment base by 18 per cent and contributed to improved accounting systems among small enterprises, Mr Sathit pointed out.
He said the tax collection base will be greater while loopholes allowing tax evasion must be eliminated to increase the number of taxpayers.
Deputy Permanent Secretary for Finance Rangsan Srivorasart said the total tax revenue of Bt2 trillion, representing collections at a 20 per cent level for corporations, is rather low compared to other countries and a tax structure reform is necessary.
“A VAT increase by only 1 per cent will boost the country’s revenue by Bt84 billion and affect the gross domestic product (GDP) and inflation by only 0.015 per cent and 0.61 per cent respectively,” he said.