Taxpayers get a raw deal

Although the government believes that a cut in the employees’ contribution to the Social Security Fund (SSF) from 3% to 0.5% is a valuable assistance measure to this vast group of people who are excluded from the latest relief scheme, the measure is still unsubstantiated and unfair.

The launch last week of the government’s “Rao Chana” (We Win) handout scheme to ease the impact of the new wave of Covid-19 outbreak has drawn criticism, particularly from workers covered by Section 33 of the Social Security Act (SSA) who have no access to the relief package.

Under the government’s 210-billion baht scheme, the state will provide a total of 3,500 baht a month per person for two months to cover 31 million people, while 11 million employees under the SSA — like government officials and state enterprise employees — are excluded from the handout scheme.

Workers under the SSA have yet to receive financial aid under the government’s relief packages since the first wave of pandemic last year even though some are affected by salary cuts, welfare and allowance cuts, and working day reductions due to the impact on their employers in the wake of coronavirus pandemic.

Those employees are regular taxpayers who contribute to state coffers every year but it seems that they are being ignored by the government.

Government spokesman Anucha Burapachaisri, however, said Prime Minister Prayut Chan-o-cha had assigned the Finance Ministry and the National Economic and Social Development Council to design a relief package for government and state enterprise employees.

Such an instruction is baffling given that government officials and state employees still enjoy full salary payments.

Labour Minister Suchart Chomklin said on Friday his ministry will propose the cabinet tomorrow seek an approval to reduce contributions to the SSF by employees under the SSA to 0.5% from 3% to ease the financial plight of employees affected by Covid-19.

Under this proposal, the contributions by employers will remain at 3%. As the contribution rate is based on a monthly salary cap of 15,000 baht, this means the employees will benefit only 375 baht a month after their contribution is reduced from 450 baht to 75 baht.

The reduced contributions will affect the sustainability of the SSF and employee benefits in the long run as the scheme will cost the fund 20 billion baht, affecting the capability of the pension payment scheme which is a key mechanism to ensure social security at a time when country is ageing.

Those affected employees do not owe the government if the cabinet approves the proposal to cut contributions as their own benefits under the social security scheme will be affected while while those in need will unfairly miss out.

The government should increase its contribution to the fund from the current 2.75% or provide 20 billion baht to the fund to compensate the loss if it endorses the contribution cut.

What the government should do is give fair treatment to all affected groups of people, including affected state and state enterprise employees. Tax measures may be an effective way to promote fair relief.

The Prayut government likes to repeat its slogan “no one will be left behind”. As such, it should start paying due attention to the 11 million people who are honest taxpayers as well as a large number of SMEs that cannot access the government’s relief schemes.