The Thai Cabinet made significant economic decisions on December 24, endorsing a new minimum wage increase that will take effect in January. Prime Minister Paetongtarn Shinawatra announced the key initiatives, which also include tax incentives designed to boost consumer spending and the rollout of the second phase of the government’s flagship handout scheme.
In her remarks to the media, Ms. Shinawatra expressed optimism for economic growth exceeding three percent in 2025. As part of the government’s plan to invigorate the economy, there is a goal to establish a nationwide daily minimum wage of 400 baht (approximately S$15.90). However, a wage committee meeting on December 23 decided on a 2.9 percent increase, translating to a wage range between 337 baht and 400 baht, effective January 1, 2025.
The 400 baht maximum will only apply to regions such as Phuket, Chachoengsao, Chon Buri, Rayong, and the tourist haven of Samui. In tandem with the wage increase, the government will introduce tax breaks aimed at fostering consumer spending, although specific details on these measures were not disclosed initially. Deputy Finance Minister Julapun Amornvivat elaborated that eligible individuals could benefit from a tax deduction of up to 50,000 baht based on verified spending, excluding expenses for domestic travel. These tax breaks are set to roll out between January 16 and February 28, 2025.
Additionally, the Cabinet has approved a new phase of its handout scheme, allocating 40 billion baht to support four million elderly citizens, who will begin receiving their payments by January. This comes after the successful launch of Phase One in September, where approximately 14.5 million individuals received payments of 10,000 baht each from a total allocation of US$14 billion (S$19 billion). The government plans to extend this financial support to an estimated 45 million people in total.
These measures reflect Thailand’s commitment to enhancing the welfare of its workforce while stimulating economic engagement across the nation.
