Tax authorities and energy advocates support the Oil Fuel Fund Office's (Offo) initiative to better manage the loss-ridden Oil Fuel Fund, with its universal diesel and liquefied petroleum gas (LPG) price subsidy programmes likely to end, according to a public hearing on the 2019 Offo Act.
A substantial sum from the fund is being spent to help households and businesses, with no clear criteria to determine who really needs subsidies, said participants in the hearing co-organised by Offo and Thammasat University. Participants support Offo's plans to spend money more carefully after Pornchai Jirakulpisan, head of the policy and strategy department at Offo, said earlier the office is considering helping only specific groups of people to avoid incurring huge debts.
Authorities should target certain groups of people for help, including low-income earners such as motorcycle taxis and tuk-tuk drivers, as not all fuel users need state subsidies, said an oil trader working for a foreign energy firm.
The government must also come up with a clearer definition of a "fuel price crisis" to determine when subsidies for domestic fuel prices are justified, said the trader.
The fuel price subsidy programmes appear to be implemented continuously as policymakers tend to extend the subsidy period after expiry, the trader added.
Authorities need to find a balance between subsidies and stabilising the fund to better control spending, said Bunchon Songsamphant, the Excise Department's director for tax collection standards.
Offo is shouldering an increasing financial burden, requiring it to seek loans from banks and collect levies from gasohol consumers to support the subsidies, which aim to ease the impact of global oil and gas price fluctuations on diesel and LPG buyers.
"This is unfair for gasoline users as they are required to pay high levies to subsidise diesel and LPG prices," said Rosana Tositrakul, a former Bangkok senator who monitors state energy policy. "Gasoline users should have some returns from their high levy and tax payments."
At present, buyers of gasohol 91 and 95 pay 4.2 baht a litre for the levy and 5.85 baht a litre for excise tax through the fund, said Ms Rosana.
Input from the public hearing will be considered by authorities in order to amend the Offo Act.