Private investment under a tax incentive programme surged to 281 billion baht on the back of economic recovery, according to the Finance Ministry.
The tax break promoting domestic investment ended last year. It allowed companies to deduct as expenditures 150% of their investment value, from 100% normally.
Pornchai Theeravet, adviser on financial economics of the ministry’s Fiscal Policy Office, said on Thursday 10,411 companies had applied for the privilege, with total investment value of 281 billion baht.
The amount far exceeded 8 billion baht estimated by the Federal of Thai Industries, he said.
But tax savings alone might not be enough to persuade companies to invest more as indicated by the 2016 figures.
In that year, a bigger tax break of 200% was offered, yet it attracted only 40 billion baht invested by 8,834 companies, much less than last year.
Mr Pornchai said the sharp increase in private investment was due to the economic recovery. “All three economic indicators -- exports, private investment and tourism -- have exceeded targets.
Exports in the first 11 months of last year grew 10% compared to the ministry’s 2017 forecast of 6%. Private investment increased 2.9% in the first three quarters of 2017 compared to a projection of 2.8% for the whole year. Tourism also grew 8.1% to 31.9 million in 11 months from the year’s target of 8%.
The improvements prompted the FPO to revise its 2017 economic forecast, to be announced soon, he said.