The Nation has reported that the Revenue Department is considering ending deductions for interest payments by thinly capitalized firms.

According to Mr. Satit Rungkasiri, the director-general of the Revenue Department, highly leveraged companies, such as those with a debt-to-equity ratio of more than 3:1, may in the future no longer be allowed a tax deduction on interest payments. Such highly leveraged companies pose risks to both creditors and financial stability, according to Mr. Satit, and pay less tax as they enjoy large deductions on interest payments.

We will continue to monitor developments on this issue and provide updates here.