Halt To Oil Levy Approved: Thailand

[gregb]

I wonder how many on here would be venting at the government for their crackpot scheme should the Dems have won the election and instituted it? Looks like a case of "damned if they do, damned if they don't " for PTP on TVF.

I for one despise this current government at least as much as anyone else on this board. But destroying the future of the country through the misanthropic mismanagement of the oil fund transcends any political beliefs. To answer your question, I was equally vocal in calling the Democrats stupid when they decided to subsidze the price of diesel, and you can verify that with a simple search. That was a horrible decision. It was bad when Thaksin did it, and it was equally repugnant when the Democrats did it.

A truly enlightened policy would see fuel taxes steadily rise over time to slowly force people towards more efficient modes of transport. Example: most of the produce that comes in from the north to Bangkok stops at See Mon Muang market before being distributed to smaller markets. Anyone who ever drives Vipawadi Rangsit Road at night can see hundreds of pickup trucks parked in a long line waiting to get into the market. Sadly, there is a rail line that is almost completely unused and runs directly past the market. It is inexcusable to see all the individual pickup trucks wasting diesel fuel, when there is a very efficient and totally unused rail line right next to it. That situation only happens because the government doesn't care about moving the country towards a better future. Cargo needs to get off the roads, and onto the rails. No excuses for why that can't happen. If there are impediments to it, remove the impediments. But raise the price of fuel to make sure the existing transport system dies.

My pet peeve is governments that do not set fuel policies correctly. We need to force people out of their private vehicles before the coming serious fuel shortages do the forcing for us. Because right now we still have the capability of making an orderly transition to alternative modes of public transit. We won't have the option for a smooth transition later. If the PT really wants to amend the constitution, the only thing they should do is add an article demanding that fuel taxes rise by a few baht per liter every year, and that those revenues go towards building a subsidized public transport system for the entire country.

Eventually only the extremely wealthy will be driving their private Mercedes, and the rest of us will have access to a nearly free public transit system paid for by them. It will be a different model, but in many ways a better one, and much less sensitive to the coming oil crisis. This is where we are heading anyway. We should embrace it now rather than stupidly trying to cling to the existing system which is guaranteed to fail.

Thailand has some genuinely enlightened policy makers that try to help. The subsidized move towards NGV is one of them. The push towards trying to get more local content in our liquid fuels through domestic ethanol was another. Sadly the current government lack those enlightened individuals, and is instead intent on pushing us back towards the cliff, instead of moving us further towards the type of prosperity that will be possible in the future.

[blackthorn2005]

I look forward to the tuk tuks and taxis of Phuket discounting their fares accordingly. I just saw a pig fly past my apartment, I guess that means the price of bacon will also soar

[otherstuff1957]

PM: Oil price reductions aimed at helping poor people

-- NNT 2011-08-28

It's ironic that the part that was voted in by the poor (it that is indeed the case) has done more to help the elite in less than one month than the Democrats did in two years.

Most of the poor ride motorcycles or drive diesel pickups or NGV taxis. Motorcycles use very little fuel, so the monthly savings for the average motorcycle user will probably be about 100 baht or less. CNG (to use the correct term) is not affected by this price reduction and the price of diesel has only been reduced slightly. So, who benefits from this? Middle class people who commute to work in their own non-diesel cars!

As for their other policies - the reduction in corporate income tax is unlikely to have much effect on economic growth, but will help business owners get richer. The 50% to 100% rise in the minimum wage (if it happens) will be offset by rising prices of food and clothing, which will not bother the elite much, but will leave the poor, especially those on fixed incomes or small business owners, worse off than before.

[Crushdepth]

It's just amazing how many people don't care whether the policy is sustainable or not (it goes broke in January), just so long as it puts a few baht in their pocket right now.

Rack up that debt baby!

[Pib]

Interesting to see in today's newspaper that bus fares, both urban and inter-provincial, have not been reduced. This will certainly be a windfall for those businessmen.

So the only people who benefited from this are (1) transport operators who now have a higher profit margin and (2) the people who have enough money to buy their own car or pickup. The real grassroots whose only option is the bus get nothing, apart from a potential rise in their cooking gas price. I'm guessing that more than half of the PT supporters fall into the latter group.m,

Most of the buses and large trucks run on NGV/CNG or LPG now days so that are not affected by the levy/tax cut; a smaller percentage still use diesel. Tons of grass roots folks own/use diesel powered pickup trucks and a good many folks driving cars that use regular gasoline/petrol...they will definitely benefit from the lower cost. And as an owner of a diesel powered SUV (I'm just a regular guy, not a millionaire) I'm very appreciative of the levy/tax cut....drops my diesel bill by 180 baht per fill-up.

[Anon999]

Not much benefit for the average person. Pretty much everybody uses gasohol, apart from people with very old vehicles, or motorbike nuts who want the extra 0.1% performance regular petrol gives them.

Price cuts in diesel will have maybe a small effect on prices of consumer goods (although businesses here are not in the habit of passing savings onto customers!), but at the moment I think maybe 50% of the big trucks run on NGV, so impact will not be big.

Sales of gasohol will take a massive drop as there will be not much or no price difference with regular petrol, which I assure you the cassava growers will not appreciate.

I don't see the point really, apart of course for Pua Thai needing to fulfill their election promises!

All new fuel-injected Honda motorcycles have a sticker mandating the use of 91 petrol. Extra performance is barely noticeable, but why void your warranty for a few baht /week?

Local bike shop owner tells me she has 2-3 carby model bikes in every day for carburettor clean, all running Gasohol 95. Gasohol 95 will absorb moisture from the air and it accumulates in the carby fuel bowl, and it affects bikes more when only partial filled - more air = more moisture.

I'm no greeny, but the use of renewable energy sources has to make some sort of sense, and the renewable fuels have to be cheaper to encourage use and compensate for lost performance and extra consumption. This is a tax break for the wealthy to be funded by public debt, and makes as much sense as the rest of this government's policies.

What sort of sense is using up arable land to grow airy fairy green fuels on some fools errand to halt climate change while food gets scarcer and more expensive. Climate change is natural, it's always happened and always will and man's pathetic attempts to make a difference are laughable.

My car is not an old vehicle but was originally designed to run on 95 petrol. However, up in the North East we have the choice of 95 gasohol take it or leave it. Consequently there's both lost performance and a 10% increase in fuel consumption. What can you expect from a fuel that contains less energy? Furthermore it is taking up arable land to grow the crops needed to produce ethanol that should be producing food something that it is predicted there will be a severe shortage of in the near future.

Despite what some vested interests claim there is NO shortage of oil. It is also obvious that most people think it's only used for fuel which is totally wrong. There are a massive range of products that use oil as a basis, lubricants and plastics for instance, not to mention as a source of heating. Alternative energy is very expensive and those that require arable land to grow crops to produce them are diverting money, time and energy away from feeding the world and all are being subsidised by governments.

Instead of all the subservience to the 'green lobby' a much more fruitful activity would be to prevent productive land becoming deserts and finding a way to economically turn deserts into productive land.

[siampolee]

Taxes cut for the rich oil levies down indeed a wonderfupl fiscal policy no wonder the administration of the revenue department is being consolidated under one body, rob Peter to pay Paul and when the foreign reserves are depleted what then?

Edited August 28, 2011 by siampolee

[Comicus]

Someone correct me if I'm wrong, but I do not recall any government anywhere in the world reducing a tax on gasoline in the whole of human (gasoline) history.

This is insane at a time when all Thai towns and cities have polluted air from clogged roadways. Any responsible government should be increasing taxes to reduce dependence on vehicles, whether two- or four-wheeled. (Or three with some tuk-tuks.) With extra taxes you can begin the much-needed modernisation of the rail system.

Reduced use of vehicles might also lead to better health. Btw, how often do you see a Thai person walking in the city. I am in Chiang Mai, and the only people I see walking are farangs like myself (breathing in the diesel fumes as I wait for traffic lights to change....)

Your thinking is not going to make sense to most Thais as your thinking is based on non-Thai thinking. From all my years in LOS, Thais, especially the ones with Chinese bloodline, love to show off and care nothing about an environment. Modernisation of the country with the rail system will only happen when the elite see that they can make money and it will be done only half way.

Walking in the city? Of course, I saw million of Thais walking in the city each and everyday. At least, in the big aircon shopping centres that has a big care park to park their car :-)

[bubba]

Interesting to see in today's newspaper that bus fares, both urban and inter-provincial, have not been reduced. This will certainly be a windfall for those businessmen.

So the only people who benefited from this are (1) transport operators who now have a higher profit margin and (2) the people who have enough money to buy their own car or pickup. The real grassroots whose only option is the bus get nothing, apart from a potential rise in their cooking gas price. I'm guessing that more than half of the PT supporters fall into the latter group.m,

Most of the buses and large trucks run on NGV/CNG or LPG now days so that are not affected by the levy/tax cut; a smaller percentage still use diesel. Tons of grass roots folks own/use diesel powered pickup trucks and a good many folks driving cars that use regular gasoline/petrol...they will definitely benefit from the lower cost. And as an owner of a diesel powered SUV (I'm just a regular guy, not a millionaire) I'm very appreciative of the levy/tax cut....drops my diesel bill by 180 baht per fill-up.

I guess I haven't seen many inter-provincial buses powered by NGV. Just the same, the drop in fuel price doesn't affect gas, so nobody who has to take the bus gets any benefit. Yes, there are plenty of bus services who use diesel, including in Bangkok, so those businessmen pocket the windfall.

As for regular guys driving around in diesel SUVs (Fortuner maybe?)...enjoy. Do take some time to consider how this sudden loss of revenue to the government will be paid for.

[Pib]

Interesting to see in today's newspaper that bus fares, both urban and inter-provincial, have not been reduced. This will certainly be a windfall for those businessmen.

So the only people who benefited from this are (1) transport operators who now have a higher profit margin and (2) the people who have enough money to buy their own car or pickup. The real grassroots whose only option is the bus get nothing, apart from a potential rise in their cooking gas price. I'm guessing that more than half of the PT supporters fall into the latter group.m,

Most of the buses and large trucks run on NGV/CNG or LPG now days so that are not affected by the levy/tax cut; a smaller percentage still use diesel. Tons of grass roots folks own/use diesel powered pickup trucks and a good many folks driving cars that use regular gasoline/petrol...they will definitely benefit from the lower cost. And as an owner of a diesel powered SUV (I'm just a regular guy, not a millionaire) I'm very appreciative of the levy/tax cut....drops my diesel bill by 180 baht per fill-up.

I guess I haven't seen many inter-provincial buses powered by NGV. Just the same, the drop in fuel price doesn't affect gas, so nobody who has to take the bus gets any benefit. Yes, there are plenty of bus services who use diesel, including in Bangkok, so those businessmen pocket the windfall.

As for regular guys driving around in diesel SUVs (Fortuner maybe?)...enjoy. Do take some time to consider how this sudden loss of revenue to the government will be paid for.

Increased 7% VAT intake is one way...people will now have more money to spend at Lotus, Big C, take a road trip to a tourist locations, etc. Pretty hard to escape the VAT tax even when other taxes are cut. Yeap, Fortuner.

[robblok]

Interesting to see in today's newspaper that bus fares, both urban and inter-provincial, have not been reduced. This will certainly be a windfall for those businessmen.

So the only people who benefited from this are (1) transport operators who now have a higher profit margin and (2) the people who have enough money to buy their own car or pickup. The real grassroots whose only option is the bus get nothing, apart from a potential rise in their cooking gas price. I'm guessing that more than half of the PT supporters fall into the latter group.m,

Most of the buses and large trucks run on NGV/CNG or LPG now days so that are not affected by the levy/tax cut; a smaller percentage still use diesel. Tons of grass roots folks own/use diesel powered pickup trucks and a good many folks driving cars that use regular gasoline/petrol...they will definitely benefit from the lower cost. And as an owner of a diesel powered SUV (I'm just a regular guy, not a millionaire) I'm very appreciative of the levy/tax cut....drops my diesel bill by 180 baht per fill-up.

I guess I haven't seen many inter-provincial buses powered by NGV. Just the same, the drop in fuel price doesn't affect gas, so nobody who has to take the bus gets any benefit. Yes, there are plenty of bus services who use diesel, including in Bangkok, so those businessmen pocket the windfall.

As for regular guys driving around in diesel SUVs (Fortuner maybe?)...enjoy. Do take some time to consider how this sudden loss of revenue to the government will be paid for.

Increased 7% VAT intake is one way...people will now have more money to spend at Lotus, Big C, take a road trip to a tourist locations, etc. Pretty hard to escape the VAT tax even when other taxes are cut. Yeap, Fortuner.

So if i understand correctly there was no VAT on the fuel. That is why there will be a vat increase. ?

I thought vat on the fuel will equal the amount of vat that will be gained by the extra money that is now available if spend (if spend at mom and pops shops there is no vat)

[Comicus]

Fuel products have always been considered a tax tit for governments; good to see at least one government weaning themselves and allowing the money to stay in the peoples' pockets.

Any government can basically only take in (through taxes) and give out (running the country) money on a break-even basis. If they reduce the tax on fuel they will either have to reign in spending, or take it back in a different way. Same goes for the increase in basic wage (which is a great idea). But there's no free lunches (despite what the government will promise in an election). It's all a money-go-round, and if they reduce the fuel tax they will find another way to increase taxes elsewhere.

Maybe the government could cut the military's budget, especially those classified/top secret budgets that the military has been enjoying for years. If they could do that effectively, they would be able give people more tax cuts.Needless to say that someone in the military would not allow that and would take over the government on stacks of corruption chrages and/or the famous 'Lèse majesté' charge first

[Pib]

I don't know if fuel included VAT; I'm saying the savings people experience from reduced taxes/levies on fuel will most likely be spent on other products/services where the current 7% VAT is charged....like buys at Lotus, Big C, etc....resulting in an increase in the amount of revenue from the current VAT (not an increased VAT like going from 7% to 8%)...but at least the people will have more things in their bags from those Lotus, Big C, etc., buys since they had more money in their pocket for the buys due to the scraped fuel levy.

[mortenaa]

It's ironic that the part that was voted in by the poor (it that is indeed the case) has done more to help the elite in less than one month than the Democrats did in two years.

Most of the poor ride motorcycles or drive diesel pickups or NGV taxis. Motorcycles use very little fuel, so the monthly savings for the average motorcycle user will probably be about 100 baht or less. CNG (to use the correct term) is not affected by this price reduction and the price of diesel has only been reduced slightly. So, who benefits from this? Middle class people who commute to work in their own non-diesel cars!

As for their other policies - the reduction in corporate income tax is unlikely to have much effect on economic growth, but will help business owners get richer. The 50% to 100% rise in the minimum wage (if it happens) will be offset by rising prices of food and clothing, which will not bother the elite much, but will leave the poor, especially those on fixed incomes or small business owners, worse off than before.

All drivers of pickup trucks will benefit from this, as diesel is included in the reductions. I have a normal sedan car, which also runs on diesel, so I was also happy to see today's pump prices.

[Comicus]

Fuel products have always been considered a tax tit for governments; good to see at least one government weaning themselves and allowing the money to stay in the peoples' pockets.

Any government can basically only take in (through taxes) and give out (running the country) money on a break-even basis. If they reduce the tax on fuel they will either have to reign in spending, or take it back in a different way. Same goes for the increase in basic wage (which is a great idea). But there's no free lunches (despite what the government will promise in an election). It's all a money-go-round, and if they reduce the fuel tax they will find another way to increase taxes elsewhere.

All right!!! Just went and filled-up the Toyota Fortuner with diesel. The fillup cost me about 180 baht less...now I can go out and buy a couple of small trees to plant to satisfy the tree huggers; or just go to Lotus and buy a 180 baht more of stuff....but that would mean I would get charged the 7% VAT so I don't want to do that because that gives more tax money back to the govt. I know, I'll just go to the local market and buy a 180 baht more vegetables and fish for the dinner table. Or maybe just save that 180 baht towards the next purchase of diesel....or my god, if I do that Thailand will use a little more diesel, the worldwide price of oil will shoot up again and it will increase global warming. So, I guess I better go buy some small trees....and I don't think the tree guy charges VAT.

Without paying VAT, you should be able to get a BIG tree with your 180 Baht so don't let any tree guys convienced you otherwise. Mark my words

[Pib]

It's ironic that the part that was voted in by the poor (it that is indeed the case) has done more to help the elite in less than one month than the Democrats did in two years.

Most of the poor ride motorcycles or drive diesel pickups or NGV taxis. Motorcycles use very little fuel, so the monthly savings for the average motorcycle user will probably be about 100 baht or less. CNG (to use the correct term) is not affected by this price reduction and the price of diesel has only been reduced slightly. So, who benefits from this? Middle class people who commute to work in their own non-diesel cars!

As for their other policies - the reduction in corporate income tax is unlikely to have much effect on economic growth, but will help business owners get richer. The 50% to 100% rise in the minimum wage (if it happens) will be offset by rising prices of food and clothing, which will not bother the elite much, but will leave the poor, especially those on fixed incomes or small business owners, worse off than before.

All drivers of pickup trucks will benefit from this, as diesel is included in the reductions. I have a normal sedan car, which also runs on diesel, so I was also happy to see today's pump prices.

Yeap, with diesel going down 10% (which is not a slight reduction IMHO) from 30 to 27 baht per liter, it will save quite a few people money; money which they can spent on other things.

Edited August 28, 2011 by Pib

[Comicus]

Ok so Gasoline is actually petroleum. I wish the Americans would conform with the rest of the world and simply call it petrol would be a lot less confusing. Gasahol is an American blend of Petroleum and alchol? I believe this was outlawed in Australia a few years back as it was destroying engines. Why is it still being used in Thailand. Natural gas I understand as it is conectect to almost every home in australia just as water is comes straight out of the ground into homes.

There is no need for the Americans to conform with the rest of the world, seriously! In deed, their American language makes an English languaue looks pretty superior, don't you think so!

[Comicus]

It's just amazing how many people don't care whether the policy is sustainable or not (it goes broke in January), just so long as it puts a few baht in their pocket right now.

Rack up that debt baby!

Did you refer to the people of an Amazing Thailand? if yes, please accept the simple fact that it is an Amazing Thalaind after all

[edwinchester]

Not much benefit for the average person. Pretty much everybody uses gasohol, apart from people with very old vehicles, or motorbike nuts who want the extra 0.1% performance regular petrol gives them.

Price cuts in diesel will have maybe a small effect on prices of consumer goods (although businesses here are not in the habit of passing savings onto customers!), but at the moment I think maybe 50% of the big trucks run on NGV, so impact will not be big.

Sales of gasohol will take a massive drop as there will be not much or no price difference with regular petrol, which I assure you the cassava growers will not appreciate.

I don't see the point really, apart of course for Pua Thai needing to fulfill their election promises!

All new fuel-injected Honda motorcycles have a sticker mandating the use of 91 petrol. Extra performance is barely noticeable, but why void your warranty for a few baht /week?

Local bike shop owner tells me she has 2-3 carby model bikes in every day for carburettor clean, all running Gasohol 95. Gasohol 95 will absorb moisture from the air and it accumulates in the carby fuel bowl, and it affects bikes more when only partial filled - more air = more moisture.

I'm no greeny, but the use of renewable energy sources has to make some sort of sense, and the renewable fuels have to be cheaper to encourage use and compensate for lost performance and extra consumption. This is a tax break for the wealthy to be funded by public debt, and makes as much sense as the rest of this government's policies.

My brand new FI Honda cbr250 has a sticker on the tank clearly saying '91 E10'. The dealer also said that gasohol is perfectly acceptable.

[Crossy]

Amongst all this 'helping the poor' stuff did anyone notice this gem

The suspension of the contribution to the Oil Fund, he added, will affect the subsidy for LPG, which Attawit said was used by every household for cooking. Even though the diesel price has dropped by Bt3, the price of LPG will rise from Bt280 to Bt570 per 15 kg cylinder, he said.

(my bold)

From here

So a price rise of 100% in the cost of an essential domestic fuel is 'helping the poor'?

[Ricardo]

Maybe the government could cut the military's budget, especially those classified/top secret budgets that the military has been enjoying for years. If they could do that effectively, they would be able give people more tax cuts.Needless to say that someone in the military would not allow that and would take over the government on stacks of corruption chrages and/or the famous 'Lèse majesté' charge first

This is about-as-likely as the new government stopping giving back 'his' money to DL IMO.

Edited August 29, 2011 by Ricardo

[MikeyIdea]

Someone correct me if I'm wrong, but I do not recall any government anywhere in the world reducing a tax on gasoline in the whole of human (gasoline) history.

This is insane at a time when all Thai towns and cities have polluted air from clogged roadways. Any responsible government should be increasing taxes to reduce dependence on vehicles, whether two- or four-wheeled. (Or three with some tuk-tuks.) With extra taxes you can begin the much-needed modernisation of the rail system.

Reduced use of vehicles might also lead to better health. Btw, how often do you see a Thai person walking in the city. I am in Chiang Mai, and the only people I see walking are farangs like myself (breathing in the diesel fumes as I wait for traffic lights to change....)

Spot on. You spoke my mind.

I wouldn't call it insane, It is just stupid beyond words

This reminds me of Mr. Thaksin, running politics that is not good for the country, only good to be re-elected

[bkkjam]

I spend THB10,000 on petrol a month so the price cut on unleaded 91 is great.

I may even 'upgrade' to unleaded 95.

[thaihome]

...Millions upon millions of Rai of Casava is going to become virtually worthless in the next few months, and who suffers?

tapioca exports will continue to grow and support the cassava growers. Casseva usage in biofuels may decline, but shold not have a huge impact on caseseva prices.

TH

[lannarebirth]

Interesting to see in today's newspaper that bus fares, both urban and inter-provincial, have not been reduced. This will certainly be a windfall for those businessmen.

So the only people who benefited from this are (1) transport operators who now have a higher profit margin and (2) the people who have enough money to buy their own car or pickup. The real grassroots whose only option is the bus get nothing, apart from a potential rise in their cooking gas price. I'm guessing that more than half of the PT supporters fall into the latter group.m,

Most of the buses and large trucks run on NGV/CNG or LPG now days so that are not affected by the levy/tax cut; a smaller percentage still use diesel. Tons of grass roots folks own/use diesel powered pickup trucks and a good many folks driving cars that use regular gasoline/petrol...they will definitely benefit from the lower cost. And as an owner of a diesel powered SUV (I'm just a regular guy, not a millionaire) I'm very appreciative of the levy/tax cut....drops my diesel bill by 180 baht per fill-up.

Are you saying that diesel trucks and buses can now run on CNG and LPG? The most efficient systems I've seen (which are rather expensive) would allow for about a 30% CNG to 70% Diesel mixture.

[lannarebirth]

Amongst all this 'helping the poor' stuff did anyone notice this gem

The suspension of the contribution to the Oil Fund, he added, will affect the subsidy for LPG, which Attawit said was used by every household for cooking. Even though the diesel price has dropped by Bt3, the price of LPG will rise from Bt280 to Bt570 per 15 kg cylinder, he said.

(my bold)

From here http://www.thaivisa....the-red-shirts/

So a price rise of 100% in the cost of an essential domestic fuel is 'helping the poor'?

That was the first thing my wife noticed, and while we can well afford it, whatever the price is, she says she's switching to using the electric appliances.

[elgato]

The levy cut would explain the HUGE line of tanker trucks I saw today waiting to cross the border from Chiang Khong into Laos. I stopped counting at 45!

[Crushdepth]

The levy cut would explain the HUGE line of tanker trucks I saw today waiting to cross the border from Chiang Khong into Laos. I stopped counting at 45!

That could never happen

Edited August 29, 2011 by Crushdepth

[Schnitzel]

I've just bought me a bottle of palm vegetbles oil today and spent 55 Baht. Last week it was 39 Baht, so it gained around 30%.

For me it doesn't matter as I don't work here 12 hrs @ every day but I'm shure there are others out there

Welcome to the start of hyper-inflation that is spanning the globe.

Thanks for your heartly Welcome :jap:

I've just watched this again:

This is real hard stuff

[apetley]

What with the proposed hike in the price of diesel tomorrow prices in our area are just about back to the pre scrapping of the levy price.