Tuesday, June 30, 2009

VAT BENEFITS FOR THAI GEMS AND JEWELRY INDUSTRY

The Bangkok Post reports that the Thai government plans to promote theThai gem and jewelry sector by abolishing the value-added tax charged on imported raw materials for the production of jewelry.

Prime Minister Abhisit Vejjajiva announced at a gem and jewelry seminar that the government is aware that the taxation has impaired the gem and jewelry sector’s competitiveness in the global market.

He added that with the aim of lowering costs, the tax for imported materials will be reduced to a 1% withholding tax.

Prime Minister Vejjajiva announced: "The Revenue Department will ask the Finance Ministry to propose the new tariff incentive to the cabinet for consideration." He added that the
gem and jewelry industry is among the country’s top four largest export sectors, with a value of 280 billion baht (2% of the global market).

Last year Thailand ranked fourteenth in exporting gem and jewelry products. Some 1.1 million Thais are employed in the industry.

Finance Minister Korn Chatikavanij stated: "This step will lead to higher government revenue in the long run and it will benefit business operators and more than one million workers in this industry.”

In the first five months of 2009, Thailand exported gems and jewelry valued at 165 billion baht. The gem and jewelry sector’s export value for the entire year is expected to reach 300 billion baht.

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