Thailand approves shopping tax break in bid lift spending, growth

BANGKOK (Reuters) – Thailand’s cabinet approved on Tuesday a tax incentive to spur shopping before the end of the year, a government official said, as the military government tries to boost Southeast Asia’s second-largest economy.

The government will allow Thais a tax deduction of up to 15,000 baht ($453) on certain goods and services they buy between Nov. 11 and Dec. 3, Nattaporn Jatusripitak, an adviser in the Prime Minister’s Office, told reporters.

Nattaporn said the incentive is expected to cost the government about 2 billion baht in revenue while spurring about 10 billion baht in spending.

Last year, the government offered a similar incentive for shoppers.

Private consumption accounts for half of Thailand’s economy but has been curbed by high household debt levels and low farm prices.

The finance ministry has forecast economic growth of 3.8 percent this year, up from 3.2 percent in 2016.

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