The Finance Ministry will propose a new tax incentive for small and medium-sized enterprises (SMEs) to help them increase competitiveness and cut costs in the tougher business environment.
The ministry is planning a new tax ladder: SMEs with revenue not exceeding 3 million baht will be subject to 15% corporate income tax, which will rise to 20% for those with revenue of more than 3 million baht.
The proposal will be submitted to the cabinet by year-end.
The Revenue Department is expected to lose 1 billion baht in revenue if these new rates are implemented.
SMEs entitled to these new incentives must have registered capital of no more than 5 million baht and annual revenue not exceeding 30 million baht.
A source said the new tax rates would be included in a new stimulus package aimed at boosting the economy. As part of the package, the measure would not aim to create household debt as the previous government did with the first-time car buyer scheme.
Other stimulus measures include a launch of nanofinance services aimed at addressing the problem of underground loans. Nanofinance entails extending small loans with few or no requirements for collateral assets.
During the Yingluck Shinawatra administration, SMEs' first 300,000 baht revenue was tax-free and 300,001 to 1 million baht was taxed at 15%. Revenue exceeding 1 million baht was taxed at 20%. Corporate income tax for big corporations was cut to 20%, dampening the competitiveness of SMEs.
The Finance Ministry will also seek new methods of registering SMEs, as their exact number is unknown. A survey indicates 2.7 million, but only 1 million are registered.