Conflict, Legitimacy and Government Reform: Equitable Allocation of ...

Panel Discussion
One problem is that governments often have tax relief policies.
Most recently, Somchai Wongsawat’s administration waived personal
income tax for those with taxable income below 150,000 baht per year,
thus shrinking a tax base (taxpayers). Another problem is tax collection
issue and tax evasion is rampant. Individuals working in the private
sector earning a very high income can hire a legal advisor to help them
pay minimum personal income tax. Many government and state
enterprise employees who have withholding tax deductions don’t submit
an income tax return form with full details of their incomes. Failure to
submit an income tax return form is considered an offence but this has
been neglected along the way. If any government wants to enforce this, it
will lose popularity. Everyone knows that many government and state
enterprise employees earn higher income than their regular wages and
salaries, as observed from their cars, houses and other tangible aspects of
their standards of living.
In light of these problems, the number of income taxpayers has
declined constantly from 6.8 million in 2003 to 5.7 million in 2006.
(Songtham Boonyawan and Thitima, 2007) In 2008, a total of 8.6
million people filed income tax return forms (if husband and wife filing
joint tax return forms are counted, the number might be around 12-13
million) In the end, the number of people who really pay income tax
might be only around 5 million out of 38 million workers in the
country.
As for private companies, the number of companies that pay
corporate income tax totals around 301,000 out of 546,857 companies
throughout the country. In most cases, this is because the government
gives a tax waiver but there is also tax evasion issue.
In conclusion, studies revealed that the poor bear a greater tax
burden than the rich when considering the proportion relative to
income. This is because Thai government depends on indirect taxes more
than direct taxes, faces problems with a narrow tax base and rampant tax
evasion. So, any plan to raise government’s revenue from taxation must
take these issues into consideration. The study on fiscal system of
Thailand conducted by Hyun Hwa Son that addressed these issues
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