The forestry law will be amended to allow precious trees grown on private property to be felled, sold or put up as collateral with the bank without permission from the authorities, said Nathporn Chatusripitak, an adviser to the Prime Minister's Office.
The amendment will be made to Section 7 of the 1941 Forestry Act which provides a list of precious trees subject to state regulation even though they are growing on private property.
The state regulation stipulates that the owners of the land must seek permission from the relevant authorities if they want to cut down, remove or relocate the trees.
The trees in question include teak, para rubber wood, chingchan (Burmese rosewood) and phayung (Siamese rosewood).
Mr Nathporn said the regulation inconvenienced people and is counterproductive to the economy.
Once the amendment goes into effect and the regulation is relaxed, people will have more incentive to grow precious trees on their land and cut them down for sale, which would create jobs and generate income, he said.
The land, however, must have legal ownership papers: The title deed, Nor Sor 3, Nor Sor 3 Kor, Nor Sor 3 Khor, Nor Sor 2 or Sor Khor 1.
Mr Nathporn said the current law is complicated and deprives people of the economic opportunity to make money from trees they own.
"If properties are able to sell trees on a commercial scale, they could be exported. This would create another stable revenue stream for the country and growing trees is also a boon for the environment," he added.
However, Mr Nathporn said the cabinet secretary-general office has voiced caution over the amendment, arguing it could lead to fraud and abuse. Wood may be poached from national forests or public land and passed off as having been obtained legally from private property.
The office said the Ministry of Natural Resources and Environment has been assigned to devise measures to prevent abusive practices from the amended law.
The draft amendment will be submitted to the Council of State, the government's chief legal adviser, for vetting. After that, the bill will be sent to the National Legislative Assembly (NLA) whip.
Also Tuesday, Prime Minister's Office Minister Kobsak Pootrakool said the Thai Bankers Association will hold talks with commercial banks to push for the endorsement of a policy to allow precious trees to be recognised as tangible assets, which can be used as collateral for procuring loans.
In the beginning, the state-run Bank for Agriculture and Agricultural Cooperatives will include trees as collateral in their consideration of loan requests.
The government will also encourage the so-called "Tree Bank" programme to educate people about planting and maintaining prized trees.
"It is about recognising the usefulness and optimising the use of trees," the minister said.
Mr Kobsak insisted that if and when the amendment is enacted, people will be more motivated to grow "cash trees".
"It will be like personal savings in a form that sprouts branches and leaves," he said, adding that vacant land plots will be developed for growing the trees.