Finance Ministry to introduce negative income tax in 2027 for welfare improvement

The Finance Ministry is set to introduce a new welfare system with the implementation of a negative income tax within 2027.

Lavaron Sangsnit, Permanent Secretary of the Ministry of Finance, revealed that the ministry is enhancing its data infrastructure, aiming to expand its database to cover more than 60.8 million people and 600,000 businesses. This data will be integrated with the negative income tax system to allow for its rollout by 2027.

Citizens wishing to receive welfare benefits will need to submit a tax return. If their income exceeds the threshold, they will pay taxes; if it falls below, they will receive welfare support. 

Lavaron highlighted that while the government already provides welfare benefits, data is currently scattered across different agencies, such as the Revenue Department for tax filings and another for welfare cards. The new system will consolidate all this information into one unified database.

"Negative income tax means that individuals must file tax returns. If their income is below the threshold, they will receive welfare. The welfare provided will be tailored to the government's actual needs,” he explained.

“By integrating the data lake, we will address this issue and ensure targeted budget allocation.”Lavaron further explained that the Ministry of Finance is now working closely with the Ministry of Public Health to make the data lake more practical. 

This will not only give the ministry better insight into the financial situation of Thai citizens but also provide data on the physical health of the population. This will allow the government to design more precise and suitable policies for different demographic groups and regions.

He noted that using data from the data lake will enable the Ministry of Finance to tailor policies for specific regions, taking into account the varying quality of life and security in areas such as the north, south, northeast, and central regions.

Lavaron also addressed concerns about the risks to the country's fiscal health, noting that the ministry has recognised potential threats to financial stability. This year marks the first time the ministry has stated that, if revenue is insufficient, the government should refrain from incurring debt, he said.

He explained that the budget for this year remained the same as last year due to stagnant revenue collection. Furthermore, he mentioned that the government needs to explore ways to increase revenue collection. 

The data lake will play a vital role in identifying gaps in tax enforcement. For instance, businesses importing goods at low rates but declaring higher profits or income will be detected, Lavaron said, adding that this data will be cross-checked to ensure fairness in tax collection.

(2025/08/14-00:00)