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Tax relief planned for businesses after minimum wage hike

Tax relief planned for businesses after minimum wage hikeLegacy

The Finance Ministry is poised to introduce measures to support businesses impacted by the recent increase in the minimum wage. The ministry confirmed that the wage hike must be paired with tax measures to lessen the burden on businesses, following precedents set by past wage increases.

Deputy Finance Minister Julapun Amornvivat stated that the goal of the minimum wage increase is to reduce social inequality and strengthen societal foundations, ensuring steady economic progress. However, he acknowledged that implementing a wage hike affects the private sector, necessitating government intervention to mitigate the impact.

In 2018, the minimum wage was raised after the 19th Wage Committee Meeting, resulting in an average increase of 15.97 baht across seven levels: 308, 310, 315, 318, 320, 325, and 330 baht. The lowest wage was set at 308 baht per day in the three southernmost border provinces, while the highest wage reached 330 baht per day in Phuket, Chon Buri, and Rayong. In Bangkok and its surrounding areas, the wage was set at 325 baht per day.

Former Prime Minister Prayut Chan-o-cha’s administration introduced tax measures in 2018 to ease the impact of the minimum wage increase. These measures allowed companies or legal partnerships with total revenue from sales and services not exceeding 100 million baht and employing no more than 200 workers to deduct daily wage expenses paid to employees at 1.15 times the actual daily wage amount.

The Pheu Thai Party, leading the coalition government, announced plans to gradually increase the minimum wage to 600 baht per day by 2027. The initial target is to raise the wage to 400 baht per day by October 1 this year, reported Bangkok Post.

In other news, the Finance Ministry appears unlikely to extend the jet fuel excise tax reduction, which was initially introduced during the Covid-19 pandemic, stated Deputy Finance Minister Julapun Amornvivat.

Julapun addressed a recent proposal by a group of budget airlines seeking further reductions in the jet fuel excise tax. He remarked that such requests are not of immediate importance.

The story Tax relief planned for businesses after minimum wage hike as seen on Thaiger News.

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