Is Raising VAT the Only Option? Thailand’s Fiscal Policy at a Crossroads

• The proposal to increase VAT is repeatedly discussed due to government fiscal constraints and the need for more revenue.
• Plans to gradually raise VAT from 7% to 8.5% in 2028 and 10% in 2030 depend on Thailand’s economic recovery.
• The government has alternative plans, such as increasing other revenues or reducing redundant state expenditures, as the current economy is not ready for a VAT hike.
• Political realities and populist policies make it unlikely any government will raise VAT soon, as it would burden citizens and risk political backlash.
• Legally, VAT could be raised to 10%, but for over 30 years it has remained at 7% due to concerns about public impact.

Source: policywatch.thaipbs.or.th

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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