The government's digital money handout will not be implemented until the legal process for the project has been finalised, says Deputy Finance Minister Julapun Amornvivat.
“We will not start the project until the legal process is complete. It may be postponed if someone submits a petition to the Constitutional Court to rule against the loan act funding the project," Mr Julapun said during an interview on a TV show on Monday.
"If people have already spent the money, it will be difficult to resolve any pending legal issues. Therefore, we need to ensure the draft bill does not contravene any laws.”
He said the government needs to stimulate the economy, which is the aim of the digital wallet project.
“If we continue to allow the Thai economy to expand by 2% per year while the government maintains a budget deficit of 600-700 billion baht annually, by 2027 the public debt will exceed 70% of GDP, above the ceiling in the fiscal discipline framework,” Mr Julapun said.
He said stimulating the economy to expand at an average level of 5% per year will help reduce the public debt-to-GDP ratio in the medium term because when GDP expands, the ratio will narrow.
"If we don't do anything and allow the government's public debt to exceed 70%, it would derail the country’s credit rating," said Mr Julapun.
He said the country's economy is in a fragile and perilous stage. Economic growth has gradually decreased from 3.8% at the beginning of this year to 2.6% at present. By the end of this year, it may be less than 2.5%, said Mr Julapun.
Regarding whether the government can enact a bill to borrow money to fund the digital handout, he said Section 53 of the 2018 State Fiscal and Financial Discipline Act states this is dependent on whether there is justification for an urgent handout to solve an economic crisis. The government views the current situation as a crisis, said Mr Julapun.
Moreover, the delay in approving the 2024 Budget Expenditure Act, which is expected to be implemented in May next year, is projected to decrease government investment for the early part of next year, he said.
While awaiting the state investment budgets, Mr Julapun said the government has issued measures to stimulate the economy in early 2024 through tax refunds called the e-refund project, which Finance Ministry will propose to the cabinet for approval over the next two weeks.
The e-refund scheme is set to commence in January 2024, ending at the end of February 2024.
Participants need to submit their tax returns with corresponding e-receipts for the government to reimburse the taxed amount.
To be eligible for the e-refund, citizens must purchase goods and services from businesses that are part of the tax system, especially those that issue electronic invoices, to receive a tax deduction of up to 50,000 baht.
The tax refund depends on each person's tax base, he said.
For example, if a person with a monthly income of 70,000 baht (subject to an income tax base of 20%) purchases a product worth 50,000 baht, they can receive a tax refund of 10,000 baht. For consumers with the highest tax rate of 35%, they are eligible for a tax refund of 17,500 baht.