Revenue collection for the government’s fiscal year 2025 is anticipated to fall short of its target due to an economic slowdown, according to Finance Permanent Secretary Lavaron Sangsnit.
From October 2024 to May 2025, net revenue amounted to 1.7 trillion baht, which is 12.7 billion baht, or 0.7%, below the target, though it is 1.7% higher compared to the same period last year. The Finance Ministry is striving to ensure revenue collection approaches the target of 2.88 trillion baht for fiscal 2025.
The economy has grown significantly less than expected, with the initial GDP growth target of 4-5% now revised to possibly under 2%. Despite this, Lavaron noted that if revenue falls short, treasury reserves can be utilised to bridge the fiscal gap. The Comptroller General’s Department reported a treasury balance of 338 billion baht as of June 17.
A significant portion of government revenue is sourced from the Revenue Department, with businesses set to file mid-year corporate income tax returns in August, which will provide a clearer view of the business sector’s performance.
“The economy isn’t doing well — we can all feel it. Businesses are also struggling. Just look at the earnings reports of companies listed on the Stock Exchange of Thailand (SET); they are major clients of the Revenue Department, and most of them are large corporations,” said Lavaron.
The Revenue Department’s tax collections fell short of the target by 0.6% in the first eight months of the fiscal year. Their tax collection target for fiscal 2025 stands at 2.37 trillion baht. Lavaron expressed concerns about the GDP growth being nearly 3% below target, affecting tax collection expectations.
In May, the Fiscal Policy Office projected economic growth of 1.6-2.6% for this year, down from previous estimates due to global trade pressures, especially from US import tariffs, and economic slowdowns among Thailand’s trading partners.
Concurrently, the National Economic and Social Development Council (NESDC) reduced its growth forecast for the year to 1.8% from 2.8%, citing the global trade war’s effects. The revised figure incorporates government stimulus measures.
In the first quarter of 2025, the economy grew by 3.1% year-on-year, compared to 3.3% in the prior quarter. After seasonal adjustments, the economy expanded by 0.7% from the fourth quarter of 2024. Exports of goods and services increased by 12.3% in the first quarter, up from 11.5%, driven by a rush to import goods ahead of US tariffs, reported Bangkok Post.
However, the state planning unit warned of potential slowdowns in the export and investment sectors in the second quarter, with more apparent downturns anticipated in the third quarter if current trends persist.
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