Posted on 06 Sep 2013
The Joint Standing Committee on Commerce, Industry and Banking is urging the government to lower the withholding tax to 0.5-1.0 per cent to encourage border trade.
The suggestion came after a JSCCB meeting to discuss 20 industries' export problems and possible relief measures. The JSCCB comprises the Board of Trade of Thailand, the Federation of Thai Industries (FTI) and the Thai Bankers' Association.
FTI chairman Payoongsak Chartsuttipol said businesses were worried about the country's competitiveness.
The government should promote border trade, since it is more convenient than trade with other regions, through a reduction of the withholding tax on international trade from 3 per cent to 0.5-1 per cent for a temporary period. This would improve operators' liquidity and competitiveness.
JSCCIB chairman Isara Vongkusolkij said the meeting was concerned about a recession that could, in the short term, affect people at large.
The government should push for exports to help stimulate the economy, said Isara, who is also chairman of the Board of Trade of Thailand.
In two or three weeks, the committee's proposed measures for industries, particularly food, are expected to be forwarded to the Commerce Ministry for consideration.
Checkpoint upgrade
The JSCCIB also urged the government to upgrade border checkpoints to shorten transport time.
Despite the estimate of a slowdown in this year's export growth, volume will likely expand from last year, Isara said.
Payoongsak suggested setting up free-trade zones at border checkpoints, which could allow exports meant to be distributed to neighbouring countries to earn value-added-tax privileges.
Having free zones in such areas will likely add Bt20 billion to the Bt900-billion border trade, he said. The government should also help neighbouring countries connect their roads to border checkpoints for speed and convenience.
FTI vice chairman Chen Namchaisiri said the Board of Investment, which is revising its policies, should increase investment-promotion measures for upstream industries like steel, petrochemicals and rubber, which are the raw materials for most products.
