Companies given tax relief on insurance payouts during flood recovery

The government has approved a scheme to give tax relief to businesses receiving insurance payouts due to this year's floods. Spokesperson for the government, Jirayu Houngsub, announced after a Cabinet meeting that any companies which have been affected by the floods and have insurance coverage against such disasters will not be taxed on the money they receive from their insurance.

Also, to help businesses repair flood-related damages, the government is offering loans, referred to as soft loans, which total 50 billion baht ($1.5 billion). These loans have a low interest rate of 3.5% for the first two years and are capped at 40 million baht ($1.2 million) per applicant. Applications for these loans can be given in at any state financial institution or any of the 16 nationwide commercial banks. Furthermore, the Thai Credit Guarantee Corporation (TCG) is providing loan guarantees for businesses without enough collateral, with a total value of 1 billion baht ($30 million).

More supportive initiatives include the Government Saving's Bank's plan to allow a six month grace period on loan repayments and interest on loans up to 10 million baht ($300,500) per person, and urging private financial institutions to cut their minimum payment due for credit cards down to 3% for three months.

Jirayu revealed that the floods have affected up to 50 provinces, especially the northern region. In addition, according to the Thai Chamber of Commerce and the University of the Thai Chamber of Commerce, the cost of damages due to the floods is predicted to be between 30 to 40 billion baht ($901,450 to $1.2 million), which is 0.21% of the GDP. A recent evaluation found that the agricultural sector took the most damage, estimated at 27.4 billion baht ($823 million), followed by the service sector with 9.2 billion baht ($276 million) of damage, and the manufacturing sector with damages assessed at 287 million baht ($8.6 million).

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