Oil crisis : “to cut excise tax on diesel would be a waste”

At last ! It’s good to see that some thai officials are not afraid to fight for… common sense.

Since last week, the Finance Minister is “toying” with a new and brillant idea (to help people) : to cut the excise tax on diesel (there is already a subsidy on diesel, read here).

The government currently earns 3.45 billion baht a month in excise taxes on diesel.

Cutting the excise tax on diesel, as Finance Minister Surapong Suebwonglee has proposed, is a bad idea and would just waste taxpayers’ money for nothing, says a senior Energy Ministry official.

“For every one-baht excise tax cut, the state would lose 1.5 billion baht a month which is equivalent to the cost of building new hospital or public library,” said the Energy Ministry official. “The government’s effort should be directed at alternative fuel development – don’t think just about subsidies.” (Bangkok Post)

But because politics is not economy… I bet that the government will continue on the -expensive- path of subsidy.

They have no choice. At least, on the short term.

It’s vital for them in order to secure a victory at the next general elections (after the Constitution is amended).

Gasoline price in Thailand is an explosive issue.

UPDATE
Good news.

The Finance Minister has decided not to cut the diesel excise tax as the world oil price is still unstable and the tax cut will not help alleviate the burden on consumers by much. However, he is considering other measures to help the problem. (TO)

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Thailand Crisis

Coup, Economic slowdown, Terror In the South... The situation is worsening in Thailand. Bumpy road like often before.

But this time, it's different.

The key to understand the present turmoil is the inevitable... succession of King Bhumibol.


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