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March 5, 2009

Thai govt rejects requests for automotive tax cuts
Thai Prime Minister Abhisit Vejjajiva on Wednesday rejected requests by auto industry operators for the government to cut excise taxes by three per cent, but not more than 15,000 baht, across all models, individual tax rebates for car buyers and a government guarantee for down payments on new vehicles.

Thai News Agency quoted Abhisit as saying that auto industry players had proposed short, medium and long-term solutions to the government, aimed at propping up the industry, and the Ministry of Industry will study details for medium- and long-term solutions to problems in the industry.

Regarding short-term solutions including government assistance to improve the manufacturers’ potential and providing training to reduce unemployment among auto workers, there should not be a problem for the government, he said.

But not so for a request to reduce the excise tax or individual tax rebates, Abhisit said, adding that other industries might request the same if the green light is given to the auto industry.

The economic ministers, he said, had assigned both the Bank of Thailand (BoT) and the Finance Ministry to oversee how loans are provided for car purchases and how problems in the auto industry could be solved.

Requests for the government assistance come after the country’s auto industry has been hard hit by falling growth and the global recession.

Several auto makers in Thailand including Toyota, the number one in terms of sales in Thailand, and General Motors have already idled their plants and cut their staff in order to keep their businesses afloat.
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