The Finance Ministry will propose that small and medium-sized entrepreneurs be allowed to deduct 115% of the minimum wages as corporate income tax expenses for nine months, a subsidy equivalent to 9-10 baht day.
Currently, SMEs are allowed to deduct 100% of such wages as expenses.
Minister Apisak Tantivorawong said on Thursday the measure was part of the relief for employers agreed at the National Wage Committee comprising representatives from employers, employees and the government.
The committee agreed to increase the daily minimum wages by about 4%, or 5-20 baht, from 300-310 baht at present. The wages differ by province.
The tax break is limited only from April 1, when the new wages take effect, to Dec 31 this year, he added.
Eligible taxpayers are SMEs whose sales do not exceed 100 million baht a year, he said.
"Workers who have already been paid more than the minimum wages are also not qualified."
Through the measure, the government will subsidise 9-10 baht a day of the increased burden for employers, who still have to pay the remaining 10-12 baht out of their own pocket.
To help low-income earners, all employers, regardless of their sizes, can deduct as expenses 150% of the wages they pay employees who are registered low-income earners, from 100% at present. That is equivalent to a 10% reduction of corporate income tax burden for companies normally paying a 20% tax rate.
Some 11.4 million people who earn less than 100,000 baht a year registered for state welfare. Of the total, 5 million earn less than 30000 baht a year or below the poverty line.
"We will send account officers or 'poverty doctors' to talk with the 11. 4 million people so we can determine the suitable help menu," Mr Apisak said.
The ministry aims to lift a quarter of the 11.4 million above the poverty line this year," he added.
Thai media also reported earlier the employers' group also floated the idea of cutting the social security contribution rates of both employers and employees by one percentage point each for one year as a further relief for both sides.