Thai Government Gives Approval For Import Tax Reduction

by Mary Swire, Tax-News.com, Hong Kong

01 November 2001

Finance Minister Somkid Jatusripitak has confirmed to local journalists that the Thai Cabinet given the go ahead to cut import taxes to a mere 1 per cent for 200 types of raw materials that are used for manufacturing processes.

'The reduction of import tariffs to 1 percent will apply to a variety of industries, including food, processed agricultural products and textiles. The reduction will reduce production costs for Thai entrepreneurs and make them more competitive ... the tax reduction must not hurt Thai entrepreneurs,' Somkid explained.

However, the Minister noted that the reduction would not apply to agricultural products because they will be reduced incrementally in line with an accord the government signed with the World Trade Organisation. 'In the next phase, the ministries of Industry, Finance and Agricultural will also consider reducing taxes,' he said.

He added that the cut in duty will result in the government losing around 1.2 billion baht a year in revenue but it will not be in vain as it is expected that the industrial sector will receive a tremendous boost.

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