BANGKOK — The Cabinet meeting on January 7, 2025 approved the annual expenditure budget for fiscal year 2026 amounting to 3.78 trillion baht ($109.25 billion), in line with the medium-term fiscal plan (for fiscal years 2026-2031) approved by the Cabinet on December 24, 2024.
The 2026 budget increased by 27.9 billion baht ($806.36 million) or 0.7 percent compared to the 2025 budget of 3.75 trillion baht ($108.38 billion).
The government expects net revenue of 2.92 trillion baht ($84.39 billion) and will borrow 860 billion baht ($24.86 billion) to cover the budget deficit, equivalent to 4.3 percent of GDP.
The 2026 budget reflects a reduction in the deficit compared to the 2025 budget year, based on economic forecasts for 2026, which expect GDP growth of between 2.3-3.3 percent (median 2.8 percent) and an inflation rate of between 0.7-1.7 percent (median 1.2 percent).
The 2026 budget structure details are as follows:
- Regular expenses: 2.65 trillion baht ($76.59 billion) (70 percent of the total budget).
- Treasury repayment: 123.54 billion baht ($3.57 billion) (3.3 percent of the total budget).
- Investment spending: 860 billion baht ($24.86 billion) (22.7 percent of the total budget).
- Debt repayment: 151.2 billion baht ($4.37 billion) (4 percent of the total budget)
The Prime Minister has emphasized the importance of budget utilization, instructing a focus on implementing key government policies, enhancing the country’s competitiveness, and addressing urgent issues such as debt, income, and the cost of living.
“She also stressed the need to support economic expansion, further develop the production and service sectors to boost investor confidence, promote tourism, and drive continuous national development to lay the foundation for equality and sustainability in Thailand,” said Government Spokesperson Jirayu Huangsap.
Deputy Finance Minister Julapun Amornvivat explained that the 2026 budget framework is in line with the plan agreed upon by the four main economic agencies: the Ministry of Finance, the National Economic and Social Development Council (NESDC), the Bank of Thailand (BOT) and the Budget Office. The budget aims to stimulate economic growth.
The spending framework of 3.78 trillion baht includes deficit financing of 860 billion baht, with a deficit reduction of 5 billion baht and a budget increase of 27.9 billion baht, together with an estimated revenue increase of about 30 billion baht.
Further considerations were also made during the meeting. The Ministry of Finance was asked to improve the efficiency of revenue collection, while the Budget Office was instructed to ensure proper expenditure management.
The Bank of Thailand will have to monitor inflation targets to keep economic growth in a balanced range of 1-3 percent. This is in line with the agreement between Deputy Prime Minister and Finance Minister Phichai Chunhavachira and Bank of Thailand Governor Sethaput Suthiwartnarueput to keep inflation at 2 percent.
“The state budget is one of the instruments for stimulating and driving the economy. The budget planning process must adhere to the framework of fiscal discipline and the Budget Procedure Act, all of which are regulated by law. These include investment ratios, deficit limits and other fiscal rules that are clearly defined,” Mr. Julapun said.
Economic agencies generally consider the level of the budget to be adequate to stimulate the economy in the coming period.
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