Wealth redistribution calls for tax reform
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Rich-poor gap remains despite surge in savings: TDRI
The government should enlarge the tax base to cover more wealthy Thais, as the gap between the rich and poor remains even though people’s savings have multiplied more than 10-fold in two decades, according to the Thailand Development Research Institute (TDRI).
Chaiyasit Anuchitworawong, an academic at the TDRI, said yesterday that the government should attempt to add to the tax rolls high-income earners who have not paid taxes yet or have not paid according to their ability to pay.
That could boost the government’s revenue for use to improve welfare for the poor and the economically and socially disadvantaged, he said.
The TDRI’s study of household savings, capital and assets from 1988-2009 found that households without savings fell to 25 per cent of total households from 48 per cent.
Average savings increased 12 per cent per year to Bt5,145 per household per month from Bt507, thanks to income growth and a slower rise in expenses.
Among five groups in 2009, the richest reported savings of Bt6,300 per person per month, while the poorest had no savings, reflecting inequality in education.
In 2009, 94 per cent of the poorest households held financial assets of no more than Bt50,000, while 30 per cent of the richest held financial assets of more than Bt100,000.
The government should accelerate its upgrading of education standards for the disadvantaged, as the quality of education is a key determinant of a person’s income.
Basic education and savings in banks may not be sufficient for people to live on amid the rapidly changing economic situation. Financial knowledge of long-term investment and economic sufficiency should be provided for people’s financial management, he added.
