Economists warn that short-term handouts are creating a fiscal trap for Thailand, threatening a credit downgrade and a heavy tax burden for the middle class.
Leading economists have issued a stark warning over the proliferation of short-term populist campaign pledges, asserting that these policies are laying a “fiscal trap” that threatens Thailand’s long-term economic sovereignty and its international credit standing.
Speaking at a seminar hosted by the Thailand Development Research Institute (TDRI) entitled “They Hand Out, But We Pay: Time to End Populism,” Dr Athiphat Muthitacharoen of Chulalongkorn University’s Faculty of Economics warned that the nation is entering a “deeply concerning” fiscal phase.
He argued that the middle class—specifically salaried earners whose income is easily monitored by the Revenue Department—will be forced to shoulder the resulting debt through inevitable tax increases.
The ‘Short-Termism’ Trap
Dr Athiphat criticised the “political formula” of deploying immediate stimulus measures, such as the Digital Wallet, the ‘First Car’ scheme, and the ‘Half-and-Half’ co-payment programme.
While these schemes provide a transient boost to consumption, they fail to address structural economic weaknesses.
“Thai politicians have become experts in short-termism,” Dr Athiphat said. “These handouts do not build new skills for the workforce, nor do they encourage small businesses to enter the formal tax system sustainably. In reality, we are simply cannibalising future budgets. The money distributed today is a liability for tomorrow.”