Dec 23, 2012

Thailand would reduce personal income tax next year

Deputy Prime Minister and Minister of Finance said that the Thai Cabinet has just passed a resolution on December 18, 2012, to reduce personal income tax rate in order to 'narrow income gaps between the rich and the poor'.

Although the tax intervals will be increased from 5 to 7 levels, while the highest income tax bracket would be reduced the rate from 37% to 35%, lower income people will pay less tax or be exempted. The projected tax revenue for the next fiscal year is expected to decline by 7 Billion Baht. If the new tax rates pass the parliamentary approval in 2013, it would be enacted in-time for tax filing of  March 2014.

My comment is that the reduced maximum tax rate seems to give benefit to the few 'rich' people. I don't understand the logic of how this would 'narrow' the income gap between the rich and the poor. Yes, some lower income people would see reduced tax money, or be exempted at higher threshold than before, but richer people will save more.

Details (in Thai) are in the link below.

Ref: Thai Insider news

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