Thailand is expected to hold its first general election in four years this May, which could mean a new premier as Gen Prayut Chan-o-cha has reigned as prime minister and before that military leader after staging a coup in 2014.
While the political fortunes of Gen Prayut and the current coalition government remain hazy until the poll, a number of laws, projects and proposals could be halted or delayed as a new government nails down its priorities.
Some of these projects could affect the economic recovery if a political vacuum occurs while a new government forms.
The direction or implementation of laws and proposals could change or vanish depending on which groups are in power after the election this year.
DELAYED TAX ON STOCK TRADES
The implementation of a law to repeal the waiver of the financial transaction tax on share sales by individual investors in the Stock Exchange of Thailand is one key measure that might be pushed back for the next government to introduce.
The law was initially projected to become effective by mid-year as part of a government effort to ensure fair treatment in the tax system.
Recently Finance Minister Arkhom Termpittayapaisith said the law could be delayed because of opposition from the Federation of Thai Capital Market Organizations (Fetco).
Mr Arkhom said the Secretariat of the Cabinet recently sent back the draft law to the ministry for reconsideration following opposition from Fetco. This prompted the ministry to set up a team to consider Fetco's proposals for the law.
Fetco urged the ministry to abandon a proposal to collect a transaction tax from share trades, claiming the stock market still needs tax incentives to support long-term investment.
Fetco chairman Kobsak Pootrakool said the government dragging its feet on enacting the law means its understands the problems the Thai capital market is facing, such as volatility pressured by US interest rate hikes.
"Fetco is preparing to send a team to help the government explore other ways to earn more revenue through tax collection. One option is to increase the number of listed companies on the stock exchange," he said.
"More public companies means an increase in firms entering the tax system and when their business expands, some of those profits would go to government coffers."
The draft law was approved by the cabinet last November. The financial transaction tax has been on the books for more than 30 years, but the government has consistently waived it to support market development.
According to Fetco's study of the impact of the transaction tax, there is a risk average trading value in the bourse will decrease by 50%, further exacerbating the decline in trading liquidity.
The lower trading value would be a result of investors bearing a higher cost burden, said the organisation.
Collection falls under the Revenue Department's regulations, which require the payment of a 0.1% specific business tax on securities trades and a related local tax of 10% of the specific business tax, bringing the total financial transaction tax to 0.11% per share sold.
In the first year, the law requires payment of only a 0.05% specific business tax on securities trades and a related local tax of 10% of the specific business tax, bringing the tally to 0.055% per share sold.
Earlier Revenue Department director-general Lavaron Sangsnit said the financial transaction tax would result in higher overall costs to stock investors of 0.22%, lower than levies in some regional stock markets.
For the first year of enforcement, the rate is 0.055%, which will raise investors' financial transaction costs to a total of 0.195%, according to the department.
"Fetco's stance has not changed, as we continue to oppose this tax because it would have more negative effects than positive outcomes," said Paiboon Nalinthrangkurn, chief executive of Tisco Securities and former Fetco chairman.
Another law unlikely to be implemented by the current government is the mandatory provident fund.
The cabinet already endorsed the draft and the next step is forwarding to the House of Representatives for consideration.
Once the law takes effect, every company must establish a provident fund. The law is meant to ensure workers have sufficient funds for living costs during retirement.
ALL EYES ON EEC
Many Eastern Economic Corridor (EEC) projects are making steady progress.
Kanit Sangsubhan, special advisor for EEC strategic planning, said key infrastructure development projects in the EEC have already been approved.
"The EEC office will answer all further questions after the House dissolution," Mr Kanit told the Bangkok Post.
The EEC board held a meeting on March 1, chaired by Gen Prayut, and a proposal to adjust a construction contract for a high-speed rail system linking the three airports was not approved, according to media reports.
The adjustment requires negotiation between the State Railway of Thailand and a subsidiary of CP Group before it can be considered again by the board, after which it can be forwarded to the cabinet for a final say.
The anticipated House dissolution this month means the proposal is expected to be shelved until a new government is established.
A delay in construction of a high-speed rail system linking three airports in Bangkok and Chon Buri would not impact the property market in the eastern provinces as strong local demand persists, said Phattarachai Taweewong, associate director of research and communications at property consultant Colliers International Thailand.
He said the property market in Chon Buri, Rayong and Chachoengsao is mainly driven by real demand.
"In the residential market, the high-speed train project is often used as a marketing tactic or promotional feature to attract potential buyers, rather than a significant factor driving demand," said Mr Phattarachai.
Last year the market posted significant growth, particularly in Si Racha, Rayong and Chachoengsao, where new supply was ample.
Meesak Chunharuckchot, president of the Thai Real Estate Association, said a delay in the high-speed train project will not have a significant impact on the industrial sector in the eastern provinces.
"The industrial sector primarily relies on road transport and ships rather than rail," said Mr Meesak.
"As for the tourism sector, the route from Suvarnabhumi airport to Chon Buri is easily accessible by road, making travel convenient."
The Industry Ministry does not expect any delays in projects or waits for approval by the next government, said Warawan Chitaroon, director-general of the Office of Industrial Economics.
"We don't have any projects left for consideration. The ministry has no mega-projects awaiting budget allocation," she said.
RAISE YOUR GLASSES
One week before Gen Prayut announced the plan to dissolve parliament in March, the Tourism and Sports Ministry narrowly secured cabinet approval for the long-awaited 300-baht tourism fee collection from foreign travellers as well as an enormous tourism stimulus budget of 3.9 billion baht, which was approved on Jan 24.
However, the proposal to extend the hours of entertainment venues to 4am might not be decided by the current administration, said Tourism and Sports Minister Phiphat Ratchakitprakarn.
While pushing back opening hours for entertainment venues two hours was estimated by some in the industry to stimulate at least 25 billion baht for the local economy per year, the proposal drew strident backlash from health-related authorities and public communities over safety concerns.
The ministry walked back the proposal, suggesting only a pilot project on Bangla Walking Street in Phuket.
Mr Phiphat admitted it might be too late to submit this agenda for cabinet approval as it needs to be circulated to related ministries for their opinion, while the current government faces a time squeeze.
Bhummikitti Ruktaengam, advisory chairman of the Phuket Tourist Association, said even if the 4am closing time is not approved, the provincial economy will be unaffected.
There are lingering concerns about nighttime safety as long as tourists can buy alcoholic drinks from convenience stores during these hours, said Mr Bhummikitti.
He said local communities in Phuket might not agree to 4am closing times for the whole province.
If the next government decides to review this agenda, it should carefully pick specific tourist zones where communities consent to longer operation hours for entertainment venues, said Mr Bhummikitti.
LET'S TALK TURKEY
Oft-delayed talks between Thailand and Cambodia to jointly explore petroleum resources in an energy-rich area in the Gulf of Thailand are expected to take place after the general election.
A new government is expected to push ahead with negotiations after Gen Prayut dissolves the House of Representatives this month.
A joint technical committee under the foreign ministries of the two countries are working on details of the talks, according to Sarawut Kaewtathip, director-general of the Department of Mineral Fuels.
The area, claimed by both Thailand and Cambodia, is widely known as an overlapping claim area, or OCA.
In a previous interview, Mr Sarawut said he believes the OCA is likely to be a new petroleum source for Thailand and Cambodia because the site is located near the Bongkot and Erawan gas blocks.
The OCA talks started in 2001, but a conclusion has not been reached since then.
Government sources said Deputy Prime Minister Prawit Wongsuwon pushed for new talks on the matter, according to media reports in January.
Thailand is a major importer of fuel and energy supplies so a significant discovery of petroleum reserves could ease the impact of high global energy prices.
Thailand imported more costly liquefied natural gas for use in power generation following a drop in the domestic gas supply in the Gulf of Thailand.
These imports were a major reason why the power tariff, which is used to calculate electricity bills, soared to a record high.
SUGGESTIONS FOR THE FUTURE
Sanan Angubolkul, chairman of the Thai Chamber of Commerce, said many measures the current government prioritised related to the economy have long-lasting impacts, especially those in the 13th National Economic and Social Development Plan.
He said the new government should consider appropriateness and public benefits as the primary factors in approving various projects, especially in infrastructure, such as the transport sector and logistics systems becoming more convenient, efficient and connected to trading routes with neighbouring countries.
These projects could elevate the nation's competitiveness, which helps attract foreign investment, said Mr Sanan.
In terms of promoting free trade negotiations with other countries, he said Thailand needs to widen its trade markets as much as possible, especially in the agricultural sector, spreading risks from existing markets as the global economic cools.
Mr Sanan said he expects the new government will push for the use of enacted free trade agreements and seek new pacts with more countries.
"All political parties have presented policies and measures related to economic issues and public welfare," he said.
"The chamber believes the new administration will continue to prioritise these issues and consider economic benefits more than political issues."
