NCPO considers new taxes aimed at wealthy

[webfact]

Junta Considers New Taxes Aimed At Wealthy
By Khaosod English


Gen. Prayuth Chan-ocha, chairman of the NCPO. [DPA]

BANGKOK — Thailand's military junta is considering new inheritance and property taxes to address the country's wealthy disparity, sources say.

Sources from the Ministry of Finance (MFA) told Khaosod that the proposal also calls for more tax cuts for the poor.

The junta, known as the National Council for Peace and Order (NCPO), has reportedly accepted parts of the MFA proposal but advised that the reforms be delegated to the new civilian government. The interim government, which has been partially formed, will administer the country until the next general election, scheduled for the end of 2015.

"The NCPO has agreed with the inheritance tax, because it can help improve equality in society," said an official at the Ministry of Finance.

According to the World Bank, income inequality in Thailand has fallen in recent years but "stays consistently high above 0.45," as measured by the Gini coefficient. Research from the Thailand Development and Research Institution (TDRI) indicates that economic inequality in Thailand is more pronounced than in similar-sized economies in countries like Colombia, Brazil, Malaysia and Indonesia.

Ministry of Finance officials said the NCPO also agreed with raising taxes on properties owned by land magnates in Thailand and cutting taxes for the poor.

"This new tax reform will increase revenues for the state by at least 100 billion baht," the source said.

The NCPO also reportedly considered raising the VAT tax, from the current rate of 7 percent to 10 percent by October 2015, officials at the Ministry of Finance said.

Since seizing power from the elected government on 22 May, the NCPO has launched a number of campaigns aimed at winning the hearts and minds of ordinary Thais. The measures have included regulating the costs of public transportation, organising free "happiness" fairs and concerts, and cracking down on organised crime.

However, last week the NCPO rejected a proposal to regulate water and air pollution, arguing that a new set of laws will impose more burdens on business owners.

Source: http://en.khaosod.co.th/detail.php?newsid=1408364908&typecate=06&section=

-- Khaosod English 2014-08-19

[terryp]

as usual much more to this than the people are really being told ..the wealth tax is only a small part of overall NEW tax's being put forward

also IMO increasing VAT is just dumb

[chooka]

as usual much more to this than the people are really being told ..the wealth tax is only a small part of overall NEW tax's being put forward

also IMO increasing VAT is just dumb

Have to pay for the fleet of submarines some how.

[CNXTim]

ahh yes, a general who cares about the public purse.

[Bluespunk]

Be a lot easier just to get the rich to pay the current taxes they appear to avoid.

[NongKhaiKid]

New taxes aimed at the wealthy ?

Let The Games Begin !

[HiSoLowSoNoSo]

The poor will be the ones hurting most from all these new taxes. The inheritance tax will in some cases force people to sell their family land because they can't afford to pay the tax. This is common in western countries.

[apetley]

New taxes aimed at the wealthy and then propose increasing vat to 10% which is easily the best way to hit the poorest.

That suggestion is as dumb as it gets.

[siampolee]

This policy could indeed put an interesting slant on how those in positions of power politically and commercially along with the average Thai person support this current junta and any such subsequent administrations as may evolve.

Spreading the tax burden a little more evenly is indeed a vote catcher, we should remember the vast majority of the electorate in any country have the voting power if not the wealth power.

There were as we are all aware of no doubt muttering from previous administrations concerning land taxes, inheritance taxes etc but to date nothing has been done to implement these proposed measures. The one fly in the ointment in my view and many others views too is the proposed possible implementation of a 10% V.A.T. is a harmful move which hits the lower paid far harder than those with above average incomes

When ones assets are threatened cheap rhetoric is a fine defence and it creates a veil of deceit that cloaks the unwillingness to implement such policies.

In fact if we look back into recent political history here we see clear evidence of the laws being amended to benefit those with enormous commercial assets with the taxation policies being modified regarding the taxes payable on share trading deals along with the law relating to foreign shareholding ownership policies so as to benefit one persons particular family businesses. With regard to land taxation upon death there needs to be a base tax free level on the estate value as there is in the U.K .

Small family owned land or other commercial assets say to the level of 4 million baht or as an example let us say of 300 rai should be exempt from taxation as a death duty inheritance factor.

So if there is to be a junta with a controlling power and no opposition as such to its action and that junta actually implements a fairer taxation system that has to be a positive move for all concerned.

Edited August 18, 2014 by siampolee

[Boxclever]

I thought the Junta was cracking down on populist policies??

[kurtgruen]

How is increasing VAT tax supposed to help the poor???

Reducing income tax for the poor??? The poorest don't file tax returns now, so how would it benefit them? Three percent extra VAT, on the other hand, will make their life so much harder for them.

Oh well, I guess BIG BROTHER knows best. Hail BIG BROTHER and his infinite wisdom and generosity

[BSJ]

Well no-one said the road to a better Thailand would be as smooth as the Chonburi-Bangna motorway!

But property taxes tend to hurt some poor people.

And inheritance tax can be of little value to the public purse if the well off disburse their money before they kick off.

And no-one I know is happy about the GST going from 7 to 10%. But no-one wants to pay more tax anyway!

[Bluespunk]

I thought the Junta was cracking down on populist policies??

Taxing in the same manner as developed societies the world over is a populist policy?

Not sure it is, you know.

Edited August 18, 2014 by Bluespunk

[ColdSingha]

if you took all the money away from the rich and gave it to the poor within 10 years the rich would have it all back again and the poor would once again be poor..

cant fix being pennywise

[Christie Paul]

That gushing sound you can hear in the distance will be the flight of capital.

[chainarong]

Inheritance tax was phased out in OZ eons ago, it stifles the wealthy to go for the big one, they go off shore and jeopardises people that have done good under their own steam from going just that little further, money starts getting tied up in family trusts it becomes a waste of time for the government to chase something that will take twenty years to resolve, all you have to do is have the Oz Tax system ,where now every cent you earn through a bank or financial institution ,l tax payed , Auto advises the Tax dept ,come tax time they know how much you have earned and tax paid, also the top limit should be 48% for high income earners, for the low income earners the first four hundred thousand BAHT should be tax free.

[stickyrice2000]

When I hear the word 'taxes', I start to shrivel. Let the game begin.

[ramrod711]

Implementation of property taxes is a good idea, taxing peoples homes or farms that are less than 50 rai is not. Property that is rented, for farming or commercial purposes should be subject to taxation, as well as property that is bought and held for speculation. The Vat raise should be levied only on people above a certain income level, exemption cards could be issued to people of lesser means.

[AyG]

The administrative costs of a land tax would be immense. The owners of every piece of land would need to be identified. The value of each piece of land would need to be appraised (and possibly appealed against) every few years. Does Thailand really need this additional bureaucracy? Surely it would be better to enforce existing tax law, clamping down on tax avoidance.

If there were to be a change in tax law, there would be two changes I'd think are fair: taxing unearned overseas income and a Capital Gains Tax. Neither would affect the poor adversely.

[Prbkk]

Just what the economy doesn't need: uncertainty. For 2 years. As for the wealthy paying more of the tax burden...yeah, right. We shall watch that with interest but don't hold your breath.

[SteveFong]

Kudos to the General,

he has taken my tax proposals and repeated them 100%

the 10% VAT is a must, and, combined with the decrease in overall taxes to the underclass, they will do better

VAT is a user tax and is not added at the grocer,

this is a wise move, and, I would make the property taxes, retroactive to last year. for all properties owned 5 years or more

[ezzra]

"This new tax reform will increase revenues for the state by at least 100 billion baht," the source said.

!00 billions... please remind me how many hundreds of billions were squandered of frivolous and populist policies like the rice schemes and the cheap cars for all schemes and others...

[Tatsujin]

They don't need any new Tax or VAT laws/rules . . . simply enforce the existing laws and collection of taxes, remove the under the table payments made to avoid those tax payments and the money received will far exceed the 100 billion they quote here.

[worgeordie]

Getting the rich to pay more tax,is a very good thing,and could

only be implemented by the army,as politicians, been amongst

the richest section of society would never pass such a law,no

matter if it helped the country and the poorest people.

regards Worgeordie

[HiSoLowSoNoSo]

Are they broke or why suddenly all these new taxes?

[SteveFong]

The need for social services in Thailand is dire

Hell, they dont even have sidewalks that meet

[prism]

The need for social services in Thailand is dire

Hell, they dont even have sidewalks that meet

Which is why there is a need for some property taxes, as long as it's properly and fairly implemented. I hated paying property taxes when I lived in the states, but I did get to enjoy reasonably funded schools that are within walking distance that are free, libraries, sidewalks, street cleaning on a regular basis, professional emergency services and many other services that are lacking in Thailand.

[kamahele]

I wonder what will be done to collect the taxes already on the books which the wealthy do not pay...

[SteveFong]

The need for social services in Thailand is dire

Hell, they dont even have sidewalks that meet

Which is why there is a need for some property taxes, as long as it's properly and fairly implemented. I hated paying property taxes when I lived in the states, but I did get to enjoy reasonably funded schools that are within walking distance that are free, libraries, sidewalks, street cleaning on a regular basis, professional emergency services and many other services that are lacking in Thailand.

sanitation,

ambulances with more than yellow bags,

subsidized housing for the aged,

more than one back hoe per every 10 miles

[leesgems]

I thought the Junta was cracking down on populist policies??

I believe the main problem was populist policies that cost the government money. The inheritance and real estate tax are likely to help spread land to the poor and provide the government with money. The framework of this tax is designed to insulate the poor from being taxed and subject large dormant parcels to ever increasing taxes thus the rich will be encouraged to sell the land.