The dynamic structure factor, which determines the Thomson scattering spectrum, is calculated via an extended Mermin approach. It incorporates the dynamical collision frequency as well as the local-field correction factor. This allows to study systematically the impact of electron-ion collisions as well as electron-electron correlations due to degeneracy and short-range interaction on the characteristics of the Thomson scattering signal. As such, the plasmon dispersion and damping width is calculated for a two-component plasma, where the electron subsystem is completely degenerate. Strong deviations of the plasmon resonance position due to the electron-electron correlations are observed at increasing Brueckner parameters r(s). These results are of paramount importance for the interpretation of collective Thomson scattering spectra, as the determination of the free electron density from the plasmon resonance position requires a precise theory of the plasmon dispersion. Implications due to different approximations for the electron-electron correlation, i.e., different forms of the one-component local-field correction, are discussed.