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Idle money won’t be used insists State

Idle money won’t be used insists State

A draft bill on seizure of idle money parked in dormant bank accounts for at least 10 years will seek cabinet approval by December, says the head of the Fiscal Policy Office (FPO)

The bill is aimed at permitting the Finance Ministry to transfer idle deposits worth more than 2,000 baht per bank account to Treasury reserves. Account owners and their heirs can always request the money returned, said Suwit Rojanavanich, director-general of the FPO.

“The draft bill does not intend to allow usage of the [frozen] money for any public benefit, rather it aims to maintain it for the public. The bill stipulates the state cannot use the money for any purpose, but it could be amended to allow use for public purposes. One example is money that is not redeemed from government bonds that have expired for more than 10 years, which could be immediately seized as state money,” he said.

There are around 10 billion baht in deposit accounts that have been dormant for 10 years or longer, said Mr. Suwit. Banks now deduct fees on an annual basis to maintain accounts that have deposits outstanding of no more than 2,000 baht. After the cabinet’s approval, the draft bill will be deliberated by the Council of State and the National Legislative Assembly, and details can be changed.

Mr. Suwit said the bill will benefit both depositors and financial institutions as it lowers banks’ costs in maintaining the inactive accounts and cuts their burden for deposit contributions. Commercial banks are taxed at 0.47% of their deposits, of which 0.46% goes to repay the rescue fund’s debt of more than 1 trillion baht, and the remaining 0.01% goes to the Deposit Protection Agency. The four state-owned banks are subject to a surcharge of 0.18% of their deposits for a fund to develop specialized financial institutions.

Permanent secretary for finance Somchai Sujjapongse said many countries including Australia, Britain, Japan, the US, and Malaysia have the same practice to deal with dormant accounts. In related news, the FPO made a statement dismissing a social media message claiming the government is going broke and needs to seize the idle money to use it, saying the state’s financial position is solid with Treasury reserves of 523.8 billion baht at the end of September.  Source: Bangkok Post

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