BANGKOK, 31 August 2011 – The Ministry of Finance will make the promise of tax reduction scheme for first-time auto buyers come to pass, while related departments will discuss the issue of tax refund to those buyers to prevent profiteering.
According to Deputy Finance Minister Boonsong Teriyapirom, the Departments of Revenue and Excise will in the next few days discuss the new policy to reduce tax by up to 100,000 baht for people who purchase cars for the first time provided that the price does not exceed one million baht.
The refund will be made by allowing buyers to deduct 20% of the deductible amount allowed, which is 100,000 baht, from their taxable income for five consecutive years; much like depreciation deduction. The whole process will take five years to complete. .
The Department of Revenue will consider whether the refund should be made via cheque, similar to personal income tax, or tax crediting. The authorities will also prevent the use of others’ ID cards to purchase cars and transfer their ownership later on, for example; only buyers with income tax records are entitled to this policy.
The Ministry of Finance is expected to present the details of this policy to the cabinet this September; the policy is expected to be in effect this October.