Thailand will start collecting value added tax (VAT) from foreign technology companies starting Wednesday (Sep 1). According to a senior official from the Thai government, the tax is expected to raise at least minimum of 5 billion baht ($154.70 million) in additional revenues each year.
Foreign platforms which provides electronic services in Thailand will have to register for VAT payments. At present, 69 companies out of 100 targeted have registered.
The tax collection for firms are divided into five categories. This includes platforms getting income from ecommerce and advertising like Google and Facebook, intermediaries such as ride hailing app Grab and streaming services such as Netflix.
Firms with revenue of over 1.8 million baht will have to pay 7% VAT every month. At present, Thailand collects about 800 billion baht annually from VAT. At the end of August 2021, the Thailand government approved an extension of the current 7% VAT rate until September 2023. The VAT rate has been at 7% since the Asian Financial Crisis in 1997-1998.