Govt revenue shortfall: Steep fall in tax revenue

06 มิถุนายน 2560

Govt 80 billion baht short in tax revenue in first eight months of year due to fall in oil tax revenue. Projected to not meet tax collection targets this year.

GOVERNMENT & PUBLIC FINANCE

Govt revenue shortfall: Steep fall in tax revenue

6/06/2017
Wichit Chantanusornsiri

The Revenue Department's tax collection fell short of target by 80 billion baht for the first eight months to May.

The tax shortfall adds to the country's largest tax-collecting agency a possibility of failing to miss this fiscal year's target.

SHORTFALL DUE MOSTLY TO BIG DECLINE IN OIL TAX

The shortfall in government revenue was largely due to the steep decline in petroleum income tax.

Petroleum income tax for the first eight months of the year was 30 billion baht lower than the target.

It is estimated the full-year shortfall will reach 45 billion.

This is according to Prasong Poontaneat, director-general of the Revenue Department.

The crude oil price stands at US$41 per barrel, well below the Revenue Department's estimate of $60 a barrel on average this year, resulting in the tax revenue shortfall.

PROMPTPAY HIT TO BANK REVENUE AND GOVT TAX ON THAT REVENUE

The government initiated PromptPay system, a cheap electronic money transfer service, took a bite out of commercial banks' net profit.

Lower profit for banks resulted in lower tax payments to the Revenue Department, Mr Prasong said.

2017 FISCAL YEAR TAX TARGET: EXPECTED SHORTFALL

"In the 2017 fiscal year, we expect that we would not be able to achieve the 1.87-trillion-baht tax revenue target," he said.

"For fiscal 2018, the Revenue Department's target is expected to be slightly higher than this fiscal [year]."

LAST YEAR SURPASSED TARGET

The department collected 1.76 trillion baht, 7.2% below target, in the 2016 fiscal year ending on Sept 30, 2016, while the government collection was 2.39 trillion baht, which surpassed its target by 2.7%.

State revenue exceeded the collection target by 63.5 billion baht and surpassed the fiscal 2015 total by 180 billion baht.

A 56.2-billion-baht revenue surge from the 900- and 1800-megahertz spectrum auctions for mobile phones was the major contributor to the better-than-targeted revenue collection in 2015.