Thai Cabinet approves assistance for SMEs

BANGKOK, September 9 (TNA) - The Thai Cabinet has approved measures on financial support for local small and medium-sized enterprises (SMEs), including over 200-billion-baht soft loans, as well as tax cuts and tax exemption. New Thai Deputy Prime Minister Somkid Jatusripitak told journalists of the measures on September 8 after the Cabinet's weekly meeting, explaining that the new measures are aimed to assist local SMEs during the ongoing national economic slowdown. Somkid pointed out as the Thai government provides them with access to the soft loans and lower corporate income tax, it is hoped that the local SMEs should become stronger over the next 4-5 years. Meanwhile, new Finance Minister Apisak Tantivorawong told reporters that, under the new measures, Government Savings Bank (GSB) is assigned to lend 100 billion baht to government-run and local commercial banks with 0.1 per cent interest and the financial institutes will then provide soft loans to local SMES with interest rates of 4 per cent. Apisak elaborated that the Thai government will subsidise the lending by giving 2.86 per cent interest to GSB for seven years and the subsidy will cost the state 2.8 billion baht annually or over 20 billion baht in the seven-year period. Besides, Thai Credit Guarantee Corporation and lending banks will guarantee SME loans, totally worth 100 billion baht, by each promising to repay 15 per cent of their non-performing loans (NPLs). Apisak said GSB, Krungthai Bank and Small and Medium Enterprise Development Bank will also set up a 6-billion-baht fund to co-invest in local SMEs. In addition, corporate income tax is exempted for local SMEs with annual profits of 300,000 baht and lower, while those with higher profits will enjoy a tax cut at 10 per cent, from 15 per cent, for two years. According to the new Thai finance minister, new SMEs registered from October 2015 to December 2016 will enjoy a tax waiver for five years. (TNA)