Bangkok (VNA) – Thai finance permanent secretary Lavaron Sangsnit has voiced his support for the negative income tax (NIT) scheme, which would provide welfare payments to workers, also known as workfare, when their income falls below a specified threshold.
Lavaron said the scheme will stimulate people to work in exchange for receiving welfare payments from the state if they earn a low level of income. For workers earning less than the minimum threshold, the state would provide a subsidy to cover the difference between the person's income and the threshold.
For unemployed people, the state might provide some help, but it won't be as substantial as the aid granted to those who have jobs.
Lavaron noted that NIT is not about simple welfare but workfare, implying recipients need to work to get increased government benefits.
According to him, introducing the NIT scheme can cut state welfare costs and remove overlapping in the current welfare system, which includes about 20 plans such as the state welfare card, costing up to 50 billion THB (1.4 billion USD) per year.
To be eligible for workfare, individuals have to submit their yearly personal income tax forms to the Revenue Department to confirm their income eligibility.
As a person's income increases, the state would provide extra support in a stage known as "phase in". Once someone's earnings reach a certain mark, the state support rate becomes stable. If the income exceeds the minimum limit, the government stops its support.
The NIT concept was first suggested by the Fiscal Policy Office 10 years ago. Unlike classic welfare, where people might get state benefits without working, NIT requires participants to work and be part of the tax system./.
