Panel dismisses TOT’s USD1bn claim against AIS

31 May 2011

A government-appointed arbitration panel has dismissed Thai state-owned telco TOT’s claim for THB31.46 billion (USD1.03 billion) in excise tax from the country’s leading cellco Advanced Info Service (AIS), reports local newspaper The Nation. According to AIS, the five-member panel ruled on 20 May to dismiss the case, reasoning that AIS does not breach relevant contracts. The excise tax had been introduced in 2003 by the government of Thaksin Shinawatra, imposing levies of 2% and 10% respectively on fixed line and cellular operators, deductable from their build-transfer-operate (BTO) concession fees before the remainder was paid to their BTO concession issuers – in the case of AIS, TOT. The tax is estimated to have cost TOT and sister telco CAT almost THB100 billion in lost BTO concession revenues. After Thaksin was ousted in a coup, the new government scrapped the excise tax in 2007. The following year TOT filed a claim for AIS to repay excise tax deducted over 2003-07, plus monthly interest, a total amount of THB31.46 billion.