Big companies in line for SME tax break
The government is considering imposing another measure to encourage large corporations to lend a hand to small and medium-sized enterprises (SMEs), says Finance Minister Apisak Tantivorawong.
The measure would allow the big players to request tax deductions on expenses for helping SMEs.
"The measure will be considered by policymakers in the next few weeks," Mr Apisak said on Friday at the MAI Forum 2016 hosted by the Market for Alternative Investment.
An assisting company can claim its expenses for helping SMEs and request a tax deduction of one or two times higher than normally expensed items, he said.
Examples of items that can be booked as expenses are providing advice on how to improve accounting standards, supporting SMEs with computer software and programmes, or being a loan guarantor.
Previous government measures to help SMEs cost 350 billion baht. These measures included loan guarantees, soft loans and special privileges for new entrepreneurs.
The government is focused on developing and assisting SMEs, as there are up to 2 million operators in the segment.
"If we can upgrade perhaps 500,000 or 1 million firms to be stronger players, that will be a powerful driving force for the economy," said Mr Apisak. Small players should have a chance to receive some support, which the government hopes can narrow the gap with the big players, he said.
"Large corporations have money to pay for cutting-edge technology, which will eventually replace the human workforce. So it makes sense for us to boost growth in SMEs, who will help the country maintain the employment rate," said Mr Apisak.
He asked SMEs to seek listing on the MAI as it can be a significant low-cost capital resource for them, especially for family businesses, where the small-firm bourse creates standards that enable efficiency to keep businesses afloat in the market for the long term.
"You can look at the record -- all successful family businesses go through a transition period, and those that failed to stay alive are those that failed to keep up with new business environments," said Mr Apisak.