Finger pointed at Thai Finance Ministry to fulfill rice-subsidy scheme

[dcutman]

You are correct, most Thais do not understand that a Government has NO MONEY; it can only spend what it raises in taxes OR borrows......QED most Thai's do not pay tax that they can see....VAT is nominal to them if they shop at markets and drink Lao Kao.....so no big deal. What is happening here is the Government saying to the Finance Ministry, " you have to find the money...." Guess what, its like a Bank having a lot of defaulting loans asking the markets for Capital.......the price just goes up!!

S & P and Moody's will soon lower the Soverign debt rating for Thailand and the cost of borrowing will go only one way.....who pays for this.....not the farmers in Isaan or the Mom and Pop stores or the noodle sellers or street traders, but the businesses and people who pay business or personal In come Tax......why should they pay for something which doesn't benefit them......"seconds out - round Two"......

Good point Moon Shadow, this current Thai administration is spending more that it raises, 20% of the annual budget is funded by debt. This debt is on the books, the rice scam, 1997 debt, onion scam, rubber scam and the proposed 2.2 trillion debt are all off the books. Eventually all these debts have to be paid or at least maintained, that means every Thai and ex-pat can expect increased taxes, fees, levies and rampant inflation, that is the cost of living in Thailand will increase and the quality of life will decrease. Anyone who doesnt accept the fundamental truth of this is living in LaLa land.

Is it only me, or do others feel VAT going to 10% in the very near future?

[MoonShadow]

Lots of good stuff from the gloom merchants here and I wouldn't care to disagree with the dark forebodings that they prophesy. Looking at the future begs the question what happens if Thailand reneges on it's debts?

Some time ago it was bandied about that Thaksin would be the leader of ASEAN. What a prospect knowing what we know now.

I don't think thats likely in the short to medium term, what I think they are, or should be, coming to terms with is that they are either going to have to renague on their promises or hike taxes.....given the former is a 'face' issue and the latter will affect more Democrats than Red Shirts, what do you think they will do???

Just what was the purpose in giving every child a computer tablet when the whole education system is flawed? What's the point in paying 50% over the market price for rice when you don't control the market and in fact have lost that #1 rice exporter slot.....lets follow it up with Rubber.......lets tell everyone that price inflation is only an illusion......and of course the THB 300 minimum wage has no effect except to price Thais out of the market in favour of Burmese.....ask any Thai who had to leave school to support the family and has only a basic education how they can get a job which pays a meaningful wage.....its just the same as the caste system in India......now their jobs are being taken by Burmese........

[MoonShadow]

You are correct, most Thais do not understand that a Government has NO MONEY; it can only spend what it raises in taxes OR borrows......QED most Thai's do not pay tax that they can see....VAT is nominal to them if they shop at markets and drink Lao Kao.....so no big deal. What is happening here is the Government saying to the Finance Ministry, " you have to find the money...." Guess what, its like a Bank having a lot of defaulting loans asking the markets for Capital.......the price just goes up!!

S & P and Moody's will soon lower the Soverign debt rating for Thailand and the cost of borrowing will go only one way.....who pays for this.....not the farmers in Isaan or the Mom and Pop stores or the noodle sellers or street traders, but the businesses and people who pay business or personal In come Tax......why should they pay for something which doesn't benefit them......"seconds out - round Two"......

Good point Moon Shadow, this current Thai administration is spending more that it raises, 20% of the annual budget is funded by debt. This debt is on the books, the rice scam, 1997 debt, onion scam, rubber scam and the proposed 2.2 trillion debt are all off the books. Eventually all these debts have to be paid or at least maintained, that means every Thai and ex-pat can expect increased taxes, fees, levies and rampant inflation, that is the cost of living in Thailand will increase and the quality of life will decrease. Anyone who doesnt accept the fundamental truth of this is living in LaLa land.

Is it only me, or do others feel VAT going to 10% in the very near future?

The official rate has been 10% for some years but temporarilly lowered to 7%.....easy to take that off and use the publisised and official rate.....

[MoonShadow]

You are correct, most Thais do not understand that a Government has NO MONEY; it can only spend what it raises in taxes OR borrows......QED most Thai's do not pay tax that they can see....VAT is nominal to them if they shop at markets and drink Lao Kao.....so no big deal. What is happening here is the Government saying to the Finance Ministry, " you have to find the money...." Guess what, its like a Bank having a lot of defaulting loans asking the markets for Capital.......the price just goes up!!

S & P and Moody's will soon lower the Soverign debt rating for Thailand and the cost of borrowing will go only one way.....who pays for this.....not the farmers in Isaan or the Mom and Pop stores or the noodle sellers or street traders, but the businesses and people who pay business or personal In come Tax......why should they pay for something which doesn't benefit them......"seconds out - round Two"......

Good point Moon Shadow, this current Thai administration is spending more that it raises, 20% of the annual budget is funded by debt. This debt is on the books, the rice scam, 1997 debt, onion scam, rubber scam and the proposed 2.2 trillion debt are all off the books. Eventually all these debts have to be paid or at least maintained, that means every Thai and ex-pat can expect increased taxes, fees, levies and rampant inflation, that is the cost of living in Thailand will increase and the quality of life will decrease. Anyone who doesnt accept the fundamental truth of this is living in LaLa land.

Is it only me, or do others feel VAT going to 10% in the very near future?

The official rate has been 10% for some years but temporarilly lowered to 7%.....easy to take that off and use the publisised and official rate.....

Sorry that should read 'Published' and the link I forget to add is :- https://tax.thomsonreuters.com/blog/onesource/vat-gst-management/thailand-maintains-7-vat-rate-until-2014/

[rametindallas]

. . . which will cost the government Bt270 billion . . .

No, it will cost the country and its people Bt270 billion++++, it's not coming out of the Govt or Politicians pockets for crying out loud, it's going INTO their pockets. WAKE UP PEOPLE!!!!!

Most Thai's don't pay taxes; therefore, as far as they are concerned it's not costing them one baht so they pretty much ignore all the news reports on the rice scheme....plus, most probably don't have a clue how the scheme works so that's another reason not to be concerned. Mai ben lai.

You are wrong. Every Thai pays taxes.

You're talking VAT?

[moe666]

. . . which will cost the government Bt270 billion . . .

No, it will cost the country and its people Bt270 billion++++, it's not coming out of the Govt or Politicians pockets for crying out loud, it's going INTO their pockets. WAKE UP PEOPLE!!!!!

Exactly The citizens of Thailand need to realize it is their money that is being squandered on this scheme. Reminds me of an MCOT news story in which one of the newscasters reported that individuals were stealing land from the forest department. Perhaps they don't realize that it is their

land and money that is being stolen.

The majority of the populace do not understand about "government" money.....there is little perception out there that it is actually taxpayers money.....they won't wake up to something they do not understand

I have to disagree with you as I have found out Thais are a lot more tuned in then a few here are giving them credit for they may appear to be disinterested but it is a show for many. The lady who owns a restaurant near my apartment refers to the rice she serves as Yingluck rice and she is very aware of Big Ts land dealing around Chiang Mai. Lets stop being so condescending toward Thais as they are more tuned in than the average farang would like to admit.

[rametindallas]

Once this government gets that 2.2 - 2.5 trillion Baht loan, no worries... for the life of this government anyway. Any government after this one will be hamstrung and doomed to failure because there will be NO money for populist policy or even development. Non of the projects begun by this government will be completed by a future government because their credit will be maxed out and you can't tax your way out of that kind of debt.

[moe666]

You are correct, most Thais do not understand that a Government has NO MONEY; it can only spend what it raises in taxes OR borrows......QED most Thai's do not pay tax that they can see....VAT is nominal to them if they shop at markets and drink Lao Kao.....so no big deal. What is happening here is the Government saying to the Finance Ministry, " you have to find the money...." Guess what, its like a Bank having a lot of defaulting loans asking the markets for Capital.......the price just goes up!!

S & P and Moody's will soon lower the Soverign debt rating for Thailand and the cost of borrowing will go only one way.....who pays for this.....not the farmers in Isaan or the Mom and Pop stores or the noodle sellers or street traders, but the businesses and people who pay business or personal In come Tax......why should they pay for something which doesn't benefit them......"seconds out - round Two"......

No problem as the Dems will be in office when this comes to passs and will get the blame and Big T will come to the rescue.

[Baerboxer]

You are correct, most Thais do not understand that a Government has NO MONEY; it can only spend what it raises in taxes OR borrows......QED most Thai's do not pay tax that they can see....VAT is nominal to them if they shop at markets and drink Lao Kao.....so no big deal. What is happening here is the Government saying to the Finance Ministry, " you have to find the money...." Guess what, its like a Bank having a lot of defaulting loans asking the markets for Capital.......the price just goes up!!

S & P and Moody's will soon lower the Soverign debt rating for Thailand and the cost of borrowing will go only one way.....who pays for this.....not the farmers in Isaan or the Mom and Pop stores or the noodle sellers or street traders, but the businesses and people who pay business or personal In come Tax......why should they pay for something which doesn't benefit them......"seconds out - round Two"......

Indeed. This and previous governments have done little to educate the masses. Most Thais have no idea about budgets, finance, economics and certainly don't equate government spending with money raised through taxation and borrowing. In the same way, they don't question any government spending or amounts "paid" for goods and services. They just don't seem to want to understand things like this. Not convenient - see money as always available. Thailand is in for a very rude awakening at some point.

[Ulic]

No story here. You are all mistaken. I saw an article by the government. Stockpiles are down by 50% to below 10 million tonnes

and the average selling price is $700 US. The government is making a lot of money. If anything the rice subsidy price to farmers

should be going up. So no need to publish such negative stories and comments. Move along to another subject.

[Ricardo]

Sorry but your response is a - fail.

Pedro is correct - VAT, excise duty on booze & cigarettes, pickups, petrol - the list goes on. Only a Thai hermit could avoid paying some form of tax.

Fair point, but when talking about paying "tax", most people would assume personal income tax, not VAT etc.

Which merely displays that 'most people' aren't financially-literate ... good thing for governments, too !

No story here. You are all mistaken. I saw an article by the government. Stockpiles are down by 50% to below 10 million tonnes

and the average selling price is $700 US. The government is making a lot of money. If anything the rice subsidy price to farmers

should be going up. So no need to publish such negative stories and comments. Move along to another subject. width=19 alt=whistling.gif> width=19 alt=whistling.gif> width=19 alt=whistling.gif>

And I can sell you some shares, in a bridge in London, with a discount for 'ready-cash' ?

If the numbers were really that good, then Thaksin and PTP would be shouting them from the rooftops, rather than making them 'commercially confidential' and 'a national secret', as they prefer to.

This scheme is a 'dog', not a 'cash-cow', until PM Thaksin Yingluck releases the full transparent details, and the facts are verified by all the third-parties involved !

[kirk0233]

. . . which will cost the government Bt270 billion . . .

No, it will cost the country and its people Bt270 billion++++, it's not coming out of the Govt or Politicians pockets for crying out loud, it's going INTO their pockets. WAKE UP PEOPLE!!!!!

Exactly The citizens of Thailand need to realize it is their money that is being squandered on this scheme. Reminds me of an MCOT news story in which one of the newscasters reported that individuals were stealing land from the forest department. Perhaps they don't realize that it is their

land and money that is being stolen.

The majority of the populace do not understand about "government" money.....there is little perception out there that it is actually taxpayers money.....they won't wake up to something they do not understand

I have to disagree with you as I have found out Thais are a lot more tuned in then a few here are giving them credit for they may appear to be disinterested but it is a show for many. The lady who owns a restaurant near my apartment refers to the rice she serves as Yingluck rice and she is very aware of Big Ts land dealing around Chiang Mai. Lets stop being so condescending toward Thais as they are more tuned in than the average farang would like to admit.

If the majority are as "tuned in" as you write, then it would seem they don't care since they continue to elect corrupt politicians that waste and steal revenue. The show of disinterest for show seems to extend to outward satisfaction with corrupt police and other officals as well. Who is this show of disinterest for?

[ratcatcher]

No story here. You are all mistaken. I saw an article by the government. Stockpiles are down by 50% to below 10 million tonnes

and the average selling price is $700 US. The government is making a lot of money. If anything the rice subsidy price to farmers

should be going up. So no need to publish such negative stories and comments. Move along to another subject.

I think ulic is being facetious.

Remember, he saw "an article by the government" . Naturally everything in that article was totally true and we must believe what the politicians tell us. They can get the best price way over market average because they are smart traders.

Qualifies for Not The Nation news.

I have moved along.

[zydeco]

BANGKOK, Sept 12 The Finance Ministry is responsible for finding funding, be it through domestic or foreign loans, for the new round of rice pledging scheme which will cost the government Bt270 billion, according to the deputy prime minister/commerce minister.

Niwatthamrong Boonsongpaisan was referring to an earlier statement by the Finance Ministry that it ran out of budget for rice purchase from farmers, starting October 1.

(Credit in original post.)

So, for all who say that Thailand is in good shape financially, and even say it's sitting on a lot of reserves, let's preserve this moment to realize that the government is not only broke, but looking around for ways to borrow MORE money just to continue its schemes.

And BTW, this puts the total debt for the rice scheme over 1 trillion baht which is about 1/2 of what the leaders dream of raising for their high speed rail system, to be paid off over 50 years.

Where's this cash coming from? If they don't find it, the BAAC is bankrupt.

Coming soon. 10,000 percent taxes on wine and cheese.

[cloudhopper]

The idea that the state is broke is mistaken. Sovereign states don't get their money from taxes or borrowing - they simply print whatever they need. Where do you think all the money that is supposedly being taxed and borrowed came from in the first place? Taxes, and their opposite subsidies, are merely tools of political favoritism. Bonds are merely an attempt to give fiat currency credibility, but the amount of bond issuance drastically exceeds the amount of currency in existence to service them. The outcome is inevitable but insidious since all sovereign states are doing it.

[waza]

The idea that the state is broke is mistaken. Sovereign states don't get their money from taxes or borrowing - they simply print whatever they need. Where do you think all the money that is supposedly being taxed and borrowed came from in the first place? Taxes, and their opposite subsidies, are merely tools of political favoritism. Bonds are merely an attempt to give fiat currency credibility, but the amount of bond issuance drastically exceeds the amount of currency in existence to service them. The outcome is inevitable but insidious since all sovereign states are doing it.

Yes but the value of that currency is determined by the soveriegn nations GDP, income, current account balance ect ect. You can print all the currency you like but you will just create rampant inflation as the quantity dilutes the quality.