Levy review order deemed ‘unlawful’
The Central Tax Court has ruled in favour of former prime minister Thaksin Shinawatra by revoking the Revenue Department’s order for him to pay about 17 billion baht in tax over the 2006 sale of a stake in Shin Corp. The ruling was issued by the court on Monday.
On July 18, the court ruled that the department’s summoning of Thaksin’s children, Panthongtae and Pintongta, for a tax assessment under Section 19 of the Revenue Code was unlawful as both siblings were only proxies holding shares for him, it said.
The Revenue Department should have summoned Thaksin for the tax appraisal, but it failed to do so before a deadline, the court said.
Moreover, the transaction did not constitute a change of share ownership in Shin Corp, thus Thaksin remained the share owner and he was not liable to pay tax under Section 39 and Section 40(2) of the Revenue Code.
As a result, the tax assessment by revenue officials and the committee set up to review Thaksin’s appeal was unlawful.
The court ruled to revoke the department’s Por Ngor Dor 12 form demanding a 17.6 billion baht back tax payment.
However, the court said the officials had acted within their jurisdiction and were not held for liability.
The tax notice was officially served in March 2017 and Thaksin appealed the order in the following month.
The ex-premier later filed a civil lawsuit with the Central Tax Court against the Revenue Department, Pongsak Methapitpat, Prapat Sanansilp and Pisit Srivarant who served on the committee reviewing his appeal.
The Revenue Department’s tax appraisal was made by the Supreme Court’s Criminal Division for Holders of Political Positions, which ruled to seize Thaksin’s assets worth 46 billion baht.
In its ruling, the court found that Panthongtae and Pintongta acted as proxies on behalf of their father in the share sale in January 2006.
The siblings purchased 329 million Shin Corp shares at a price of one baht each from Ample Rich, an offshore holding company controlled by the Shinawatra family. They then sold the Shin shares in their name to Temasek through the Stock Exchange of Thailand for 49.25 baht each, reaping capital gains of nearly 16 billion baht.
The government ordered the department to expedite efforts to collect about 16 billion baht in tax and fines from the former premier over the deal.
Several of Thaksin’s aides challenged the tax demand including Noppadon Pattama, who argued that the sale of shares on the stock market was not subject to tax.