Flood Tax for Thailand: The Case Study of Bangkok

Abstract

This study has examined the issue of the public support for the provision of “a yearly flood tax for national flood prevention scheme” by estimating how much the public, the general population, would be willing to pay for supporting this particular scheme for the purpose of reducing Government budget deficit in providing national flood prevention project, targeting working population in Bangkok where they will be well protected from national flood control project because of economic area reason , with a yearly payment as part of their yearly income tax.

With the main use of contingent valuation method (CVM), a 600 sample surveyed study asked 20-60 years old taxpayers in Bangkok to elicit their willingness to pay (WTP) to support this flood prevention scheme with an initial tax payment of 500, 1,000, 1,500, 2,000 or 2,500 baht/year respectively. Apart from income factor, as for the measure of total economic benefit, this study also divided respondents according to geographic characteristics of their living place in order for designing flood tax rate with equity and efficiency manner.

The results of the study found that the mean WTP values for a flood prevention scheme were 1,878 baht/year for those who have lived in low-lying area and 1,464 baht/year for those who have lived in high elevated area. In addition, personal income and the rate of tax payment were the most influential factors when individuals made their decisions on whether to sponsor this scheme. This study recommends that the Thai government should execute a progressive tax with differentiated rates according to geographic characteristic to fund this scheme when a flood prevention program becomes available.