Government authorizes THB 157 billion economic stimulus plan
The Thai government has announced a new economic stimulus plan, aimed at injecting funds into the economy to preserve employment and lay the foundation for growth. The plan, approved by the Cabinet, has a budget of 157 billion baht.
The stimulus plan focuses on several key areas: community economy, tourism, agriculture, and infrastructure, including water infrastructure and transportation.
Community Economy
The stimulus aims to support economically vulnerable groups via subsidies and the introduction of a "reverse tax" system that requires widespread tax filings and provides payments to low-income households. This move is designed to boost fiscal transparency and reduce economic inequality.
Agriculture
Although not extensively detailed in the latest coverage, part of the stimulus plan involves targeted support to the agricultural sector to maintain liquidity and investment capacity during economic uncertainty. This includes provisions for the Bank for Agriculture and Agricultural Cooperatives.
Tourism
Given tourism is a key sector of the Thai economy but currently faltering, the stimulus includes tax policies to encourage domestic tourism consumption, such as tax deductions for tourism or shopping. There is also direct support planned for the tourism and service sectors to counter slowdown due to external shocks.
Infrastructure
The government plans to accelerate the disbursement of public investment budgets for various infrastructure projects to stimulate economic activities and create domestic jobs. This includes investments in water infrastructure and transportation development to enhance efficiency and support long-term growth.
The plan includes investments in water infrastructure, such as flood prevention, water distribution, and water supply system development and improvement. Details of the plan include flood prevention during the rainy season and water storage for the dry season, water distribution to communities and agricultural areas nationwide, and development and improvement of water supply systems.
In addition, the plan includes investments in transportation, including resolving traffic bottlenecks, enhancing safety for travel and freight transport, and improving and developing roads connecting secondary cities, tourist spots, and production areas.
Export Impacts
In response to the US imposing a 19% tariff on Thai imports, measures include subsidy payments to those affected by the tariff, introduction of low-interest "soft" loans to improve liquidity for businesses, and tax incentives (such as faster VAT refunds and tax relief) to help exporters and affected industries adapt. The government may also use remaining economic stimulus funds to repay debts of state banks that lend to exporters and agriculture, thus increasing lending capacity to cushion export impacts.
Fiscal Discipline and Long-term Stability
The government emphasizes cautious implementation of these measures, balancing immediate economic relief with longer-term fiscal health and competitiveness. This includes improvements to intellectual property laws and digital economy legislation to support innovation and trade.
Agencies are required to submit project proposals using the Economic Stimulus Plan 2025 forms, and proposals must be submitted through the Deputy Prime Minister, supervising Minister, or related authority for review. The Finance Ministry's Deputy Permanent Secretary has been appointed as chair of a subcommittee to supervise and monitor project implementation under the economic stimulus plan.
The new stimulus plan also includes the cancellation of the 10,000-baht digital wallet handout for 2.7 million young people aged 16-20 and redirecting the funds to more suitable projects under the new stimulus plan.
These measures are designed to stimulate growth, preserve jobs, and enhance competitiveness amid external tariff pressures and structural economic challenges.
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