Finance Ministry plans fiscal overhaul to restore credit rating confidence

Lavaron Sangsnit, Permanent Secretary for Finance, revealed that the Finance Ministry is revising its medium-term fiscal plan, which is expected to be completed and announced within November. 

The plan’s key objective is to restore investor and credit rating confidence through enhanced fiscal discipline and clearer policy execution.

Lavaron said the new plan would differ from previous versions by including more detailed strategies and measurable targets to strengthen financial discipline. 

“If the new plan provides clear direction, it will help rebuild confidence and could potentially restore Thailand’s previous credit rating, as past plans often lacked sufficient detail,” he noted.

The revised medium-term fiscal plan will focus on two key areas: public debt management and the structure of revenue and expenditure, with two main objectives:

• Deficit control: The goal is to reduce the fiscal deficit-to-GDP ratio to below 3%, considered a sustainable level. The current deficit stands at around 4%. Lavaron noted that this adjustment cannot be achieved in a single fiscal year but will require gradual consolidation.
   
• Revenue efficiency: The plan will include a revenue reform roadmap, addressing income, expenditure, and debt management. Thailand’s current revenue-to-GDP ratio is about 14%, but it should ideally be 17–18%. It is expected to take around five years and require multiple parallel measures to improve revenue collection efficiency.

Lavaron emphasised that given the current economic challenges, the government must communicate its fiscal intentions clearly. The new plan will include specific numerical targets for each fiscal year to demonstrate progress and accountability.  “Without clear details, it will be impossible to build confidence,” he added.