Permanent Secretary for Finance Lawaron Sangsanit explained that the policy does not mean all citizens will have to pay taxes, but rather that everyone must declare their income. Those earning below the taxable threshold of B150,000 a year will remain exempt from paying taxes and still be eligible for government assistance.
“The system ensures that welfare benefits go to those who truly need them while also bringing more fairness and transparency to tax collection,” Mr Lawaron said.
The Negative Income Tax scheme will rely on a newly developed ‘data lake’ that consolidates information from multiple agencies into a single system, Mr Lawaron explained.
The Ministry already holds records for more than 60.8 million people and 600,000 businesses. Linking this data, including through cooperation with the Ministry of Public Health, will allow officials to accurately verify income, reduce duplication across more than 20 welfare programmes, and close gaps that have allowed some higher-income earners to receive benefits they were not entitled to.
According to the National Economic and Social Development Council, only 10.7 million of the 19mn registered workers in 2022 filed tax returns, with just 4.2mn earning enough to pay income tax. At the same time, more than 13mn Thais hold state welfare cards, despite some earning above the threshold.
“This reform will expand the taxpayer base by bringing moderate- and high-income earners who have previously not filed taxes into the system,” Mr Lawaron said. “It also ensures that low-income earners who have been left out of welfare in the past will now be included.”
The impact will vary across income groups:
- Current taxpayers will see little change, although income verification will become stricter.
- Moderate-income earners who have never filed may now be required to pay taxes if their income is above the threshold.
- Low-income earners will benefit most, as the government will be able to provide targeted support directly based on verified income data.
The Ministry stressed that the reform will not raise tax rates but will improve revenue collection by integrating data from the Revenue Department, Excise Department and Customs Department, closing loopholes that allow tax evasion.
Officials expect the system to modernise Thailand’s tax and welfare administration, making it more transparent, equitable and efficient.
“This is a transformation of Thailand’s tax system,” Mr Lawaron said. “It is about fairness ‒ ensuring that those who can afford to pay contribute, while those in need receive proper support.”