Finance Ministry sets up panel to study Negative Income Tax system
Restructuring tax base and revamping state welfare system on the agenda
A Tax Reform Committee has been set by the Finance Ministry to study the implementation of a Negative Income Tax (NIT) system, Deputy Finance Minister Julapun Amornvivat said.
The study will focus on two main areas: restructuring the tax base and revising over 20 types of state welfare programmes.
A key aspect of the reform is consolidating all citizen data into a single database to improve welfare provision and support mechanisms for individuals with incomes below the threshold.
Under the proposed NIT system, every citizen will be required to file income tax returns, even if they are not obligated to pay taxes. Those with incomes below the threshold would receive financial subsidies from the government.
The tax reform initiative will be carried out in phases. The initial phase will prioritise review of welfare programmes directly impacting the public, such as the State Welfare Card programme.
In the near future, the Welfare Committee for Grassroots Economy and Society is scheduled to meet to discuss the criteria and eligibility requirements for the new round of State Welfare Card registrations.
Julapun said one of the key issues under review is the definition of "personal wealth". Previous databases lacked clarity and comprehensiveness in assessing individual financial status, leading to issues where non-needy individuals were granted welfare benefits. Incomplete data on land ownership has also been a problem. However, recent committee meetings have reported progress in improving data systems.
Once the committee approves the revised eligibility criteria, the proposal will be submitted to the Cabinet for approval before the registration process begins in late March 2025.
