According to Finance Minister Arkhom Termpittayapaisit on Thursday, the Cabinet has referred the draft on taxing transactions on the Stock Exchange of Thailand (SET) back to the Finance Ministry. He claimed that after receiving a letter from Fetco objecting to the tax intentions, the Cabinet had second thoughts.
Arkhom announced that his ministry would immediately form a team to review the document and make changes in light of Fetco’s recommendations.
As it depends on how long the reconsideration process takes, “we cannot predict if the draft will be approved within the first half of this year [as anticipated],” he said.
The tax, which had been exempt for the previous 40 years, was authorized by the Cabinet to be levied in November.
Investors in SET would eventually be required to pay 0.11% per share sold if the tax were to be imposed.
Nevertheless, they would only pay 0.055% for each share sold in the first year.
According to the Finance Ministry, the new tax will bring in between 16 and 18 billion baht annually for the government.
Fetco has earlier issued a warning that the tax would discourage international investors from investing in the SET and decrease market liquidity.
Analysts claimed that the impending dissolution of Parliament for a general election that is slated to take place on May 7 is another factor behind the tax’s postponement. This stops the government from making important choices about legislation that might influence voter mood.
