New tax measures needed to incentivise hiring of retired employees: Arkhom
Finance Minister Arkhom Termpittayapaisith said on Thursday that businesses need new tax incentives to encourage them to hire retired workers and employees and solve the shortage in the workforce.
Arkhom was speaking at a seminar titled “The Next Thailand’s Future: Turning Point to Sustainability”, held by MGR Online at the Queen Sirikit National Convention Centre.
Arkhom stopped short of saying such tax incentives would be introduced by his government, whose tenure ends this month, or by the next government after the upcoming general election.
Thailand is expected to face severe labour shortage in the near future mainly because the country is entering the aged society sooner than expected and because many workers are declining to return to the workforce after the Covid-19 pandemic, Arkhom said.
“As a result, the Finance Ministry should have measures to reduce corporate taxes for firms that hire elderly workers,” Arkhom said.
The tax incentives would also benefit many workers, who have retired at the age of 60 but still do not have enough savings to live their retired life, the finance minister added.
He said labour shortage would be unavoidable in the future, although the government has been enforcing measures to maintain the level of employment.
The rehiring of people aged above 60 years would be a crucial solution, Arkhom said.
Regarding the country's economic recovery, Arkhom said Thailand might appear slower than other Asean nations but the economy was expanding at a stable pace.
Thailand has the potential to grow 4-5% this year, but the government expects the GDP would increase by 3-4% this year, Arkhom said.
The finance minister added that if workforce efficiency were to be improved, the country may gain an extra per cent in GDP growth, to achieve the potential of 4-5% growth.
He said the country was enjoying economic stability in terms of controllable inflation rate and high enough foreign reserves while the public debt and household debts were not too high.
He expressed confidence that the government would be able to lower the inflation rate to the band of 1-3% this year.
Currently, public debt amounts to 61.26% of GDP mainly because the government has to borrow to offset the budget deficit.
Budget deficit for fiscal 2023 is projected at 659 billion, while the Finance Ministry now has foreign exchange reserves of US$200 billion, Arkhom said.
