The Finance Ministry expects the "Khon La Khrueng" co-payment scheme and increased allowances under the state welfare card programme to lift private consumption by 0.87 percentage points.
According to a ministry source who requested anonymity, additional allowances under the state welfare card scheme are estimated to add 0.35 percentage points to private consumption, while the co-payment scheme will contribute 0.52 percentage points.
Combined, these two measures are projected to lift GDP by around 0.3 percentage points, said the source.
The funds are expected to primarily flow into the grassroots economy, directly benefiting retail (especially small shops), food and beverage, and personal services, which cover a wide range of small and medium-sized enterprises.
In addition, the two schemes are expected to increase value-added tax (VAT) collection by the Revenue Department by around 6 billion baht, assuming private consumption of 10 trillion baht and a VAT rate of 7%.
According to the Fiscal Policy Office's forecast at the end of July, private consumption is expected to grow by 3.1% per year, within a range of 2.6% to 3.6%.
Roughly 33 million people are expected to benefit under the co-payment scheme and uptick in state welfare card allowances:
1. State welfare cardholders: 13 million people are scheduled to receive a top-up of 1,700 baht each. Combined with the existing monthly 300 baht allowance, this totals 2,000 baht per person. The money can be spent at "Blue Flag" shops under the Commerce Ministry, either gradually or in a lump sum, but must be used by December.
2. People outside the tax system: 9 million people are slated to receive a quota of 2,000 baht each under the co-payment scheme, with the government subsidising 50% of spending, capped at 200 baht per day. Funds must be used by December.
3. Taxpayers: 11 million people are expected to receive a spending quota of 2,400 baht each under the co-payment scheme, with the government covering 50% of spending, capped at 200 baht per day. Funds must be used by December.
The combined budget for the Khon La Khrueng scheme and the state welfare card top-up amounts to 66 billion baht.
The cabinet approved the state welfare card top-up project on Sept 30.
The Finance Ministry said the co-payment scheme will be submitted to the cabinet on Tuesday, with public registration open from Oct 20-26.
Individuals should be able to start using the scheme on Oct 29, noted the ministry.
Shops wishing to participate can register from Oct 15 until the end of the project in December.
