The Revenue Department must leave its tax revenue collection target for this fiscal year unchanged even though it was 160 billion baht short of its target last year, says Finance Minister Sommai Phasee.
After discussion the Finance Ministry agreed the department must keep the fiscal 2015 collection target unchanged at 1.965 trillion baht, he said.
Sommai: VAT will be hit by weak oil prices
Mr Sommai's comment came after the Fiscal Policy Office said the ministry was considering lowering its target for the 2015 fiscal year as the stuttering economy and sagging oil prices are likely to hit government coffers.
In fiscal year 2014, government revenue totalled 2.073 trillion baht, missing its target by 202 billion as all three tax-collecting agencies fell short, in particular the Revenue Department.
The government aims to collect 2.325 trillion baht this fiscal year, running from Oct 1, 2014 to Sept 30, 2015. It set expenditures at 2.575 trillion, leaving the budget in deficit by 250 billion.
The revenue target was based on fiscal year 2014's revenue target of 2.275 trillion baht plus 50 billion.
Mr Sommai estimated weak oil prices would shave 50-60 billion baht worth of value-added tax (VAT) off government revenue from imported oil this fiscal year, with the ministry seeking measures to offset the shortfall.
However, the land and buildings tax, expected to come into effect next year, should help lower the government's burden in providing subsidies to local administration organisations.
The land and buildings tax, which will replace the local development tax that generates only 25 billion baht a year, is expected to raise tax revenue for local administration organisations by 30-40 billion.
Separately, Mr Sommai praised the Office of the Auditor-General of Thailand's (OAG) request to use asset value rather than income to assess tax payments by politicians.
Assistance from the OAG will be helpful to the Finance Ministry in plugging loopholes that are sometimes used by people to avoid full tax payments, said Mr Sommai.
Tax reform involves not only changing tax rates and widening the tax base, but also stemming tax payment loopholes, he said.
The OAG recently required the Revenue Department to assess the value of politicians' assets rather than just their income for their tax payments by adopting Section 49 of Revenue Code, a move the OAG believes will help fight tax evasion and corruption by politicians.
Meanwhile, a source at the Revenue Department said adopting Section 49 would involve some difficulties because it means asking for information from financial institutions and state agencies.
Unlike in the US where the Revenue Department is authorised to be linked to information from financial institutions and related agencies, Thai state agencies have been reluctant to share information with others.