Thirachai: Taxes may rise after deficit capped at Bt350 bn
Taxes may rise as the government seeks more revenue to fund its plans for the 2012 fiscal year, which starts next month.
Finance Minister Thirachai Phuvanatnaranubala yesterday said the Cabinet had approved the 2012 Budget Bill, under which expenditures are set at Bt2.33 trillion and revenue is estimated to be Bt1.98 trillion, resulting in a fiscal deficit of Bt350 billion.
Current spending such as civil servants' salaries is set at Bt1.839 trillion, with capital spending earmarked at Bt384 billion, Thirachai said.
The government will repay principal debt of Bt51 billion and refill the treasury reserve to the tune of Bt54 billion, he added.
It aims to cap the deficit at Bt350 billion instead of Bt400 billion as earlier reported, the minister said. This would leave it at the same level as for the current fiscal year, as the government wants to generate more revenue.
"The government is planning to seek more revenue, and we may issue an emergency executive order to raise taxes," Thirachai said.
The government's previous plan to run a fiscal deficit of Bt400 billion had met with criticism from the central bank and economists over lax fiscal discipline.
The government will also spend Bt20 billion for increasing the incomes of physicians, nurses and teachers, the finance minister said.
The past government left a burden of Bt70 billion - Bt54 billion for filling the treasury reserve and Bt20 billion for additional incomes for doctors, nurses and teachers - he said.
Ministries will have to arrange their priorities and cancel projects that are not in line with government policies, he added.
The Cabinet also assigned the Finance Ministry, the National Economic and Social Development Board and the Budget Bureau to find a way to reduce the interest burden of more than Bt60 billion carried by the Financial Institutions Development Fund.
