Thai PBS World
Are political parties promising more than the country can afford?
Compiled by KHAO Editorial — aggregated from 1 outlet. See llms.txt for citation guidance.
◌ Single Source
As Thailand approaches another general election, concerns are mounting among leaders in the business, industry, finance and academic sectors about populist cash handout promises.
Key facts
- Political parties often propose direct cash assistance as a short-term economic stimulus.
- To address fiscal discipline, the Cabinet in November approved the Finance Ministry’s medium-term fiscal framework (2027-2030), which aims to bring the budget deficit down to 3 per cent of GDP by 2029.
- The People’s Party has proposed increasing the VAT rate from 7 to 8 per cent by 2028 and to 10 per cent by 2030, but conditional on economic improvement and payment of compensation to low-income groups affected by the tax hike.
- Tax revenue as a percentage of GDP has dropped from 17 per cent to 14 per cent.”
Summary
Political parties often propose direct cash assistance as a short-term economic stimulus.
But experts warn that increasing welfare spending, debt forgiveness schemes and debt payment suspension for debtors, tax breaks and other such measures could magnify risks of long-term fiscal instability while failing to address structural challenges and could ultimately become a burden for future generations.