The cabinet has approved an extension of a 25% corporate tax exemption for bio-plastic industry companies in order to promote Thailand as an Asean bio-hub.
Rachada Dhnadirek, the deputy government spokeswoman, said the cabinet approved the proposal to extend the tax exemption until 2024.
The government is projected to lose 673 million baht in revenue a year, or a total of 2.01 billion baht over three years.
The measure was first implemented on Jan 1, 2019, and expired on Dec 31, 2021. It was put in place to support private companies to purchase bio-plastic products from Thai producers and promote bio-plastic production in Thailand.
In 2020, there were 14 companies eligible for the tax measure worth 18.3 million baht.
Ms Rachada said the measure also supports the government's policy to promote a bio-circular and green (BCG) economy.
In a separate development, the cabinet approved a budget of 3.5 billion baht for the Royal Irrigation Department to implement Klong Plo reservoir in Rayong in order to tackle water shortages in the Eastern Economic Corridor (EEC) and the eastern region as a whole.
Deputy government spokeswoman Traisulee Traisoranakul said the project will be implemented from 2022-2025.
The Klong Plo reservoir can keep 40 million cubic metres (m³) of water during the rainy season which can supply water to agricultural land in Khao Chamao and Klang district, Rayong.
The government is committed to investing 52.9 billion baht from 2021 to 2037 to ensure sufficient water supply for its flagship EEC.