BANGKOK, 25 September 2013 The Ministry of Finance will propose the reduction of taxes on ‘luxury items’ to the Cabinet, with the aim of promoting tourist spending during the tourism high season at the end of the year.
Finance Ministry permanent secretary Ariphong Phucha-um said the prime minister has told the Finance Ministry to quickly sum up its plan to stimulate tourism, especially the “Shopping Paradise” scheme. Mr. Ariphong expects the initiative to be submitted to the Cabinet for its consideration within next month.
Under this initiative, the tax on luxury items will be reduced from 30 percent to 5 percent, to promote spending by both foreign and Thai tourists during the peak tourism period at year-end.
The permanent-secretary indicated that careful evaluation would be made on the scheme, because although the increased tourism revenue would help drive the economy, the reduction of the tax could have an adverse impact on Thai businesses, especially those in clothing and cosmetics.
The Ministry of Finance is also looking at promoting border trade by means of allowing a higher limit on the amount of cash carried by individuals through border points.
According to Mr. Ariphong, trade along the border has been expanding by 20% per year.