Thailand Weighs Gold Tax to Curb Baht Rally

Thai authorities, including the Bank of Thailand and the Ministry of Finance, are considering imposing a new tax on online gold trading conducted in Thai baht to curb the currency's sharp appreciation, which threatens exports and tourism. The proposed tax would likely exempt gold trades conducted in U.S. dollars, futures exchanges, or bullion shop purchases. This move aims to slow gold exports, which have surged significantly, contributing to a stronger baht driven by a current account surplus and rising global gold prices. The Bank of Thailand has engaged with the Gold Traders Association to discuss potential measures, including encouraging more transactions in U.S. dollars and increasing surveillance to prevent illegal activities linked to gold trading. Market reactions include a weakening of the baht following the tax news and potential positive impacts on export and tourism stocks due to a weaker currency. The government plans further discussions and expects to decide on the tax after the new administration takes office.