Thailand's new Super Savings Fund (SSF) is expected to have attracted 10 billion baht (US$321.24 million) by June 30 when the three-month investment period and tax break for contributions ended, and asset managers are calling for an extension, according to a local English language daily.
The Bangkok Post says total inflows into the SSF had reached nearly 7 billion baht on June 26, quoting Vasin Vanichvoranun, chairman of the Association of Investment Management Companies (AIMC).
"We expect it would reach 10 billion baht by end of June, driven by the improved investment conditions and market sentiment," he says in the July 1 report.
Mr. Vasin says AIMC has asked the Federation of Thai Capital Market Organisation, of which it’s part, to appeal to the government to extend the investment period and tax break because the domestic stock market hasn’t fully recovered after being hammered by the coronavirus crisis.
Although the benchmark Stock Exchange of Thailand Index has mostly bounced back from a 35.81% plunge suffered between January 1 and March 23, it’s still down roughly 15% year-to-date.
Spokespersons for AIMC did not immediately respond to questions from Asia Asset Management.
Launched on April 1, the SSF is a government-led initiative aimed at encouraging Thais to save and invest. They can claim a 30% tax deduction on contributions, capped at 200,000 baht a year, provided they invested by June 30 and hold for ten years.
The fund is widely seen as a replacement for long-term equity funds, whose tax incentives ended in December, although the government hasn’t explicitly said so.