These are among the findings in a paper on the topic of “Tax-Motivated Profit Shifting and Anti-Avoidance Stringency: Firm-Level Evidence from Developing Countries.” The report was co-authored by Athiphat Muthitacharoen, a lecturer at the Faculty of Economics at Chulalongkorn University, and Krislert Samphantharak, the executive director of Puey Ungphakorn Institute for Economic Research at the Bank of Thailand.

The study focused on tax motivations to shift reported profit among foreign subsidiaries in five middle-income Asean countries – Indonesia, Malaysia, the Philippines, Thailand and Vietnam (the Asean 5).

The paper uses firm-level data from developing countries to examine the significance of tax-motivated profit shifting from high-tax to low-tax countries by multinational enterprises and to analyse the extent to which anti-avoidance measures mitigate the profit shifting.

Tax avoidance by multinational enterprises (MNEs) has received a great deal of attention in public policy discussions as  globalization has opened up opportunities for the corporations to greatly reduce the taxes they pay.

This practice, also known as base erosion and profit shifting, takes place when MNEs transfer profits from their subsidiaries in higher-tax rate countries to the ones with lower tax rates, hence minimising the total tax bill of the whole enterprise. Effectively, it reduces the tax collection of countries with higher tax rates.

The paper recommended that as tax-motivated profit shifting is significant, governments – especially those that rely heavily on corporate income tax – should therefore pay attention to this issue.

Enacting laws and introducing regulations alone are not sufficiently effective in mitigating cross-country profit shifting by MNE subsidiaries, the paper found. The government should also strengthen its auditing and transfer pricing scrutiny to prevent firms from moving reported profits to other countries

While existing measures seem to mitigate profit shifting for non-manufacturing firms and smaller manufacturing firms, there remain possibilities that large manufacturing firms will shift their profit abroad and additional efforts should be focused on these firms, the paper found.

Finally, the government should be aware of changes in tax policies, especially corporate income tax reduction, of other countries since these policies could result in higher incentives for foreign subsidiaries in host countries to shift their profit to the country with lower tax rates. That would result in lower tax revenue collection of the current host countries, according to the study.

In its third year of holding the national MICE forum, the Thailand Convention & Exhibition Bureau (TCEB) will focus on creating an arena for creating awareness and enthusiasm as Thai MICE entrepreneurs collaborate and seek new opportunities to make Thailand the regional leader and destination for the sector.

The aim is to unite all segments of the MICE sector to march in the same direction based on undivided strategies, said Chiruit Isarangkun Na Ayuthaya, president of the public organisation in a Thursday release.

“This year’s highlights are remarkable, as TCEB has the honour of welcoming executives from the world’s most prominent MICE associations, including The Society for Incentive Travel Excellence (SITE), International Congress and Convention Association (ICCA) and The Global Association of the Exhibition Industry or UFI, who will be joining Thai entrepreneurs to unveil their viewpoints on how to strengthen Thailand’s competitiveness with global MICE standpoints,” said Chiruit.

“Further, there will be a special lecture on the ‘Customer-First Experience Creation for Business Events’ by executives from Thailand’s key business sector, including Dusit Thani Group, Siam Piwat and ThaiBev. The talks will be immensely beneficial to the betterment of Thai MICE, as well as to international MICE business dealings.”

The package will provide incentives on investment, component and battery production, he added.

It will also include measures to encourage wider usage of EVs among the public amid environmental concerns.

The ministry will team up with the Finance and Industry ministries as well as the Board of Investment in drawing up the comprehensive policy.

It will also consult experts in the field to build up demand for EVs in the local market and to draw suppliers worldwide to the Kingdom.

Jim Seward, vice president, Sustainability, Technology and Joint Ventures, LyondellBasell, a representative of AEPW said: “The issue of plastic waste is seen and felt all over the world. I urge all companies, big and small and from all regions and sectors, to join us. We believe the time for action is now. Success will require collaboration and a coordinated effort across many sectors to create sustainable outcomes and impacts.”

The Alliance represents 40 companies that are headquartered in North and South America, Europe, Africa, the Middle East, and Asia. Many of these companies have significant operations in Southeast Asia, including Thailand. The Alliance has committed almost US$1 billion (Bt30 billion) in funds, with the goal of investing $1.5 billion over the next five years to develop solutions that will minimise and manage plastic waste and promote post-use solutions. Alliance efforts will focus many of its efforts in Southeast Asia, where the need is greatest.

Brendan Edgerton, director of Circular Economy from the World Business Council for Sustainable Development said: “Despite the many benefits plastics bring to people around the world, including improvements in living standards, health and safety, and sustainability, unmanaged plastic waste has become a global challenge. We are working to make the dream of a world without plastic waste a reality.”

The Alliance is a not-for-profit organisation that includes companies that make, use, sell, process, collect and recycle plastics. This includes chemical and plastic manufacturers, consumer goods companies, retailers, converters, and waste management companies, also known as the plastics value chain. The Alliance has been working with the World Business Council for Sustainable Development.

The Alliance strategy is based on making progress in four key areas: infrastructure, innovation, education and engagement, and clean up.

The Alliance also highlighted an initial set of collaborative projects that reflect a range of solutions to help end plastic waste, such as: partnering with cities to design integrated management systems in large urban areas where infrastructure is lacking; promoting technologies, business models and entrepreneurs to prevent ocean plastic waste; developing an open-source data platform to provide valuable information about the sources, location and formats of plastic waste to help support waste management projects; building collaboration with intergovernmental organisations to identify the most effective solutions; and supporting investment and engagement to capture plastic waste before it reaches the ocean.

“Sixty per cent of plastic waste in the ocean can be sourced to five countries in Southeast Asia and we agree that this is a serious global challenge that calls for swift action and strong leadership,” said Cholanat Yanaranop of SCG, “We have many successful cases and piloting initiatives, as well as, waste management projects and solutions based on the circular economy approach with the local collaborative projects, such as Smart Litter Trap 4.0,” he added.

Antoine Grange of SUEZ Asia added: “While our effort will be global, the Alliance can have the greatest impact by focusing on parts of the world where the challenge is greatest such as Southeast Asia region where more than half of the world’s plastic waste have been found, and by sharing solutions and best practices so that these efforts can be amplified and scaled-up around the world.”

Thailand has been fully aware of this global challenge and is taking a proactive approach, such as the government’s Roadmap on Plastic Waste Management for 2018 – 2030. By the end of 2022 Thailand hopes to be free of plastic bags less than 36 microns thick, Styrofoam food boxes, plastic straws, and single-use plastic cups. The goal is to reduce Thailand’s plastic ocean waste at least 50 per cent by 2027.

Thailand Public Private Partnership for Plastic and Waste Management (Thailand PPP Plastic) is an unprecedented collaboration between 15 organisations from the government sector, private sector, and non-profit organisations that on June 5, 2018 signed an MOU to address Thailand plastic marine debris.

“In 2010 Thailand ranked sixth for global marine plastic debris. With the collaboration of all parties, we can draw up a blueprint to address Thailand’s waste problems in a sustainable manner. And where possible, proliferate this blueprint to other parts of Southeast Asia,” said Jonathan Penrice, Asia Pacific President of Dow.

This contraction reflects a slowdown in domestic consumption, fiscal policy adviser Pornchai Triraveja said on August 28. The figure in June showed a contraction of 5.6 per cent.

Meanwhile, VAT collected in the first and second quarter of this year showed an expansion of 1.7 per cent and 0.4 per cent respectively, however, it showed a 0.5 per cent drop in the first seven months of the year.

However, the agency believes the recently announced government stimulus package will help prop up the softening domestic consumption, adding that some economic indicators in July show that the economy had picked up a bit from the previous month.

For instance, the import of consumer goods by the private sector had risen 17.5 per cent year on year.

Four weekly flights from Bangkok Don Mueang International Airport will begin on 27 October, 2019, offering special introductory one-way all-in fares starting from Bt 2,999, available on www.nokscoot.comfrom 28-30 August for travel between 27 October and 20 December.

The region’s leading medium-haul low-cost airline will deply Boeing 777-200 aircraft for the route , combining comfortable and reliable services with affordable fares.

The new service to Sapporo represents NokScoot’s third destination in Japan, after Tokyo and Osaka.

NokScoot chief executive officer Yodchai Sudhidhanakul, said: “We are very proud to extend our network to Sapporo, our third Japanese city, offering more choices to NokScoot customers.

According to the Thai Ministry of Tourism and Sports, 1.65 million Japanese tourists visited Thailand in 2018, representing 4.32 per cent of total arrivals. Of the total, 174,893 originated from Hokkaido, representing an 8 per cent increase on year.

Hokkaido has many tourist attractions including the Sapporo Dome, the biggest stadium in Hokkaido and home of the Hokkaido Nippon-Ham Fighters baseball team.

The stadium is also used by the football club Hokkaido Consadole Sapporo. Jay Chanathip Songkrasin, a well-known Thai football player, plays for this club. The island is also known as the land of delicious sweets such as chocolate products.

In addition to its growing route network in Japan, NokScoot also flies to Nanjing, Qingdao, Shanghai, Shenyang and Tianjin in China as well as New Delhi and Taipei.

NokScoot’s Boeing 777-200 wide-bodied twin-aisle jets are configured with a total of 415 seats. The aircraft is larger than those traditionally used by low cost carriers and offers an unprecedented level of comfort, with 24 seats in ScootPlus Premium Economy and 391 seats in Economy, supported by great fares for its customers.

The launch also aims to cash in on the increasing number of arrivals of visitors from India to Thailand every year. The airline is also considering an expansion to other tourist destinations in Thailand.

Vistara will now fly daily between Delhi and Bangkok, and will be the only airline to offer the choice of premium economy class for travel between India and Thailand, in addition to business and economy classes.

Customers from Bangkok can also take convenient onward connections on Vistara to several destinations within India, including Amritsar, Bengaluru, Chennai, Hyderabad, Kolkata and Mumbai.

Vistara’s chief executive officer Leslie Thng said on the occasion, “We’re delighted to enter another new geography with service to Bangkok, one of world’s most-visited cities with immense potential to further grow tourism as well as business.

Vistara’s chief executive officer Leslie Thng

“With Vistara, we introduce India’s best airline to Bangkok, [an airline] that’s committed to making a mark in global aviation with its world-class product and impeccable service. With a novel product and unmatched Indian hospitality, we offer a unique experience and are confident that travellers will enjoy flying the ‘new feeling’ with Vistara.”

Vistara inaugurated its international operations earlier this month with daily flights to Singapore from Delhi and Mumbai, followed by the launch of daily service to Dubai, UAE from Mumbai.

The airline now connects 27 destinations and operates over 1200 flights a week served by a fleet of 23 Airbus A320 and eight Boeing 737-800NG aircraft, and has flown more than 16 million customers since starting operations in 2015.

TATA SIA Airlines Limited, known by the brand name Vistara, is a joint venture between Tata Sons Limited and Singapore Airlines Limited (SIA) with Tata Sons holding the majority stake of 51 per cent in the company and SIA holding the remaining 49 per cent.

Vistara commenced its commercial operations on January 9, 2015 with an aim to set new standards in the aviation industry in India, and it today connects destinations across the length and breadth of the country.

SMEs and start-ups are the core of Thailand’s economy, said Ruenvadee Suwanmongkol, secretary-general of the SEC, at today’s Thailand Focus 2019 event.

Currently, SMEs provide 14 million jobs in the country and contribute 42 per cent of Thailand’s GDP, she said, adding that by 2021, SMEs will contribute up to 60 per cent of the country’s GDP.

The SEC has ten agendas that will enhance opportunities for SMEs looking to gain access to Thailand’s capital market. They include democratising market access to smaller businesses, enhancing investor protection, promoting big data analysis, enhancing international cooperation, strengthening effective regulatory reform and enforcement and adopting digital transformation.

“The SEC is working with the relevant government agencies on a potential incentive package to lower the cost for SMEs trying to raise funds through Thailand’s capital market,” Ruenvadee said.

A draft of the incentive proposal is being submitted to the executive board of the SEC and the final document is expected to be released at the end of next month, she said.

The draft is part of the SEC’s goal to promote the growth of SMEs and startups in the country by trying to lower regulatory challenges.

Furthermore, the SEC is working with government agencies to amend shareholder regulations so that SMEs will be able to distribute shares to new investors. Currently, SMEs do not have a realistic option for raising capital through this method due to regulatory barriers.

Meanwhile the Stock Exchange of Thailand (SET) has launched the LIVE platform, a platform for start-ups in Thailand to gain access to capital through crowdfunding, said SET president Pakorn Peetathawatchai.

The platform also offers training and business resources for start-ups so that they can learn to grow and start operating like a bigger business listed in the stock exchange.

The SET recognises the importance of SMEs to the country’s economic growth. Going forward, Pakorn said, the SET will be active in providing more resources and platforms for SMEs to grow.

“Thailand will pursue greater connectivity economically in the Asean region through public-private partnership infrastructure projects and strive to become the central economic, transportation and innovation hub of the region,” said Uttama Savanayana, Finance Minister, who was speaking today at the Thailand Focus 2019 organised by the SET.

Going forward, the Thai government will be looking at regulatory reform to increase the ease of doing business in Thailand which will promote investment in the country, he said.

For instance, the Finance Ministry is looking to make amendments to the current e-commerce law in order to improve the law’s transparency and clarity for investors. This will increase the ease of doing business in e-commerce and encourage more investments into the industry, he explained.

Meanwhile, he also revealed that the Board of Investment is looking into new mechanisms to promote investment in Thailand.

“The Thai government welcomes foreign investments in the government’s mega infrastructure projects. We believe we can benefit from the expertise of foreign investors and local private businesses in cooperating with the government,” he stated.

The government will also be embracing new technology, such as promoting the use of electronic systems in government administration processes such as tax payment, he said.

Furthermore, he continued, the Thai government has been active in trying to cushion Thailand’s economy amid declining global economic growth.

Uttama stated that as Thailand’s economic growth has been decelerating in the past 7 months, the Bt316 billion stimulus package is meant to stimulate domestic spending and restore investors’ confidence in the country.

Finally, the Finance Minister stressed that the current government places great importance on maintaining financial discipline in the country, mentioning the government’s determination to follow the Fiscal Discipline Act of 2018.

Pakorn was speaking at the Thailand Focus 2019, an annual event organised by the SET to inform both foreign and local institutional investors on the investment opportunities in the Kingdom’s capital market.

“The key focus of today’s conference will be on empowering start-ups and small and medium-sized enterprises (SMEs) in the country as well as increasing connectivity between Thailand and the CLMV (Cambodia, Laos, Myanmar and Vietnam) subregion,” Pakorn said.

One hundred and twenty seven foreign institutional investors with a combined market cap of US$2.6 trillion, larger than Thailand’s GDP value turned out for the event.

Also participating were 203 local institutional investors and 105 listed firms, who listened closely to the investment opportunities in the stock market, according to the SET president.

“Going forward, the SET will offer more opportunities for start-ups and SMEs to gain access to capital, which will in turn, strengthen Thailand’s economy,” he said.

The key sectors that are considered Thailand’s strength are the well-being sector, healthcare, hospitality, agriculture and manufacturing, he said, adding that the conference would discuss how Thailand can become a regional leader in these areas as the country’s population starts to age.

Meanwhile, Pakorn dismissed the potential external threats to Thailand’s stock market such as the ongoing trade conflict between the US and China.

“Thailand’s stock market has a sufficiently high level of stability as the country’s financial sector maintains an impressive level of financial discipline,” he said during an interview on the sidelines.