Stimulus measures in the works, says finance chief
Stimulus measures are expected to take shape after Prime Minister Prayut Chan-o-cha delivers the government's policy to parliament, says newly installed Finance Minister Uttama Savanayana.
After Gen Prayut's statement to parliament, Mr Uttama will talk to the ministry's top officials about short- and long-term measures to shore up the economy.
"It takes time to discuss appropriate measures, but not too long," he said. "The Finance Ministry has been preparing such measures for a while."
Mr Uttama plans to deliver the policy to ministry officials on July 22.
With the economy flagging, the private sector has asked the new government to issue stimulus measures as a priority task.
Earlier, Mr Uttama said new stimulus measures would have to be consistent with the available budget. Multiple measures may be launched, one after another, according to the changing economic situation.
The economy is losing momentum, with annual growth of 2.8% in the first quarter -- the slowest pace in more than four years.
Customs-cleared exports fell by 5.8% year-on-year in May after contracting 2.6% in April and 4.9% in March. For the first five months, exports shrank 2.7% year-on-year.
The gloomy economic and export outlooks, as well as a likely three-month delay in fiscal 2020 budget disbursement from the regular schedule that starts on Oct 1, have prompted policymakers and private research houses to turn pessimistic. Some predict that growth could fall below 3% this year.
Regarding the Palang Pracharath Party's campaign promises to adjust personal income tax, Mr Uttama said the plan requires consideration on how to proceed.
Reducing the personal income tax by 10 percentage points across brackets is one of the party's key campaign promises.
According to the current personal income tax structure, taxable income of 150,000 baht or lower is exempt from tax. The rate is 5% for 150,001-300,000 baht, 10% for 300,001-500,000 baht, 15% for 500,001-750,000 baht, 20% for 750,001-1 million baht and 25% for 1,000,001-2 million baht.
The income band for the 30% bracket is 2-5 million baht, and the range for the top rate of 35% starts at 5 million baht.