The government is planning a larger budget deficit of 713 billion baht for the 2025 fiscal year with higher spending of 3.6 trillion baht.
The government predicts gross domestic product growth of 3.6% in 2025, it said in a statement after the plans were approved by the cabinet on Tuesday. The 2025 fiscal year starts on Oct 1, 2024.
The deficit in fiscal 2025 represents an increase of 2.8% over the figure envisioned for 2024.
“The government still needs a short-term deficit budget to support continued economic expansion and stability,” the statement said.
The last time a government produced a budget with a surplus was in the 2006 fiscal year, Thaksin Shinawatra's last year in office before he was unseated by a coup.
The 2025 spending plan projects inflation between 1.5% and 2.5%, the government said, and a public debt-to-GDP ratio of 63.73% at the end of the fiscal year.
The budget for fiscal 2024 calls for spending of 3.48 trillion baht with a deficit of 693 billion, up from 593 billion approved by the previous government before the May 14 election was called.
The 2024 budget has still not been passed because of the protracted delay in forming the government following the elections. It is not expected to take effect until early May, Deputy Finance Minister Julapun Amornvivat said last week.
The cabinet on Tuesday approved the budget bill, with first reading in the House scheduled for Jan 3 and 4, Prime Minister Srettha Thavisin said.
The total spending represents an increase of 295 billion baht, or 9.3%, over the budget sought for the previous fiscal year.
Of the 3.48 trillion baht, 2.53 trillion will go to fixed annual expenditure. Another 118.36 billion baht, or 3.4%, will go to boosting treasury reserves, while 715.4 billion, or 20.5%, will be earmarked as investment funds.
The rest, Mr Srettha said, would be spent on repaying loans.