The Chartpattanakla Party has proposed a tax restructuring under which people earning 40,000 baht or less a month as a salary or for freelance work would enjoy an income tax cut.
Party leader Korn Chatikavanij said on Monday people in this income bracket made up about half of the country’s 4-million-strong income tax-paying workforce. They were the group most committed to paying income tax and deserved financial help from the government in terms of income tax reduction.
The Chartpattanakla Party saw four reasons for reducing income tax for this group.
First, the cost of living, which includes rent, home mortgages, fares, fuel and childcare, has gone up while income tax has remained the same.
Second, the tax rates on juristic entities imposed on large companies have been lowered for more than 10 years, which incentivises many rich and high-income people to generate income from stock profits or share dividends and rely less on their fixed income. However, most lower-income employees do not have such an option.
Third, the government’s finances are recovering from the pandemic, with the Budget Bureau estimating an increase in state revenue of 270 billion baht in the next fiscal year starting in October. The party’s proposed income tax cuts would cost the government around 21 billion baht a year in lost revenue.
Lastly, it was noted that some coalition parties had campaigned to reduce income tax in the previous election but hade failed to make good on their promises.
Mr Korn said that under the party’s proposal, salaried and freelance workers would be taxed less – paying no income tax on the first 300,000 baht annual income, which left a small amount remaining as their taxable income.
At the same time, tax restructuring would also benefit people in the higher tax brackets.
Details of the proposal would be announced on Tuesday.
The income tax revamp is part of Chartpattanakla’s “Fair Tax” election campaign policy, which came on the heels of the party’s call for an end to the blacklisting of individuals by the credit bureau.
The issues are among the party’s wider campaign platform to create an “affordable”, people-friendly economy.