As Thailand heads towards upcoming elections, a novel approach to broadening the tax base is generating debate. A leading prime ministerial candidate is defending a plan to incentivize citizens to submit receipts in exchange for prizes, framing it as a long-term investment in national infrastructure and economic transparency.The proposal, spearheaded by Pheu Thai Party leader Jullapong Amornvivat, aims to draw more transactions into the formal economy and is already drawing scrutiny over it’s projected costs and potential efficacy.
A leading candidate for prime minister in Thailand is defending a proposed policy aimed at boosting the country’s tax revenue by incentivizing citizens to request receipts, arguing it’s an investment in national infrastructure rather than a simple handout. The plan, which would award prizes to individuals who submit receipts, has drawn scrutiny over its potential cost.
Jullapong Amornvivat, leader of the Pheu Thai Party and a candidate for prime minister, explained in a social media post on January 25 that the initiative is designed to draw more citizens into the formal economy and tax system. He argued that the incentive of winning a prize will encourage people to request receipts, thereby expanding the tax base and increasing government revenue.
“This isn’t free money, it’s an investment to get the country’s financial and fiscal systems in order,” Amornvivat stated. He pointed to successful case studies in other countries, including Brazil, which saw an 8-9% increase in tax collection efficiency, and Taiwan, where a similar program boosted tax revenue by an average of 20%.
Amornvivat further illustrated the potential return on investment, stating that Thailand’s current value-added tax (VAT) base is approximately 800-900 billion baht. A 20% increase in collection, mirroring Taiwan’s results, would generate nearly 200 billion baht annually. The cost of the prize program is estimated at just over 3 billion baht, representing a mere 3.3% of the potential revenue gain. “This is an investment of billions with the potential to return hundreds of billions,” he said.
He contrasted the program’s cost with the country’s current public investment budget of around 800 billion baht, suggesting that even a modest increase in revenue – 12.5-25% – could significantly bolster funding for infrastructure, social welfare, and public services.
Beyond the immediate financial benefits, Amornvivat emphasized the value of the “Big Data” the program would generate. He explained that the initiative would provide real-time economic data at a granular level, revealing market trends, the activity of the informal economy, and price fluctuations. This data could then be used to inform policy decisions and target social programs more effectively.
A key goal, he added, is to bring Thailand’s substantial informal economy – estimated at 9 trillion baht, ranking 14th largest globally – into the formal system. Rather than relying on enforcement, the program aims to incentivize participation through the prospect of becoming a millionaire.
“The result is that citizens have a chance to win prizes, the state gets a new tax base, and the country gets Big Data for more accurate management,” Amornvivat wrote. He dismissed concerns about potential irregularities, asserting that the random selection process would be transparent and auditable. He argued that the greater risk lies in the inefficient and often wasteful allocation of funds due to a lack of accurate data.
“This policy shouldn’t be seen as old-fashioned populism, but as an investment in the country’s data infrastructure – a start today for returns in the future, both in the form of government revenue and a database of incalculable value,” Amornvivat concluded. The case highlights the ongoing debate in Thailand over strategies to boost economic growth and broaden the tax base.
