Integrity Legal

It recently came to the attention of the administration of this web log that the Royal Thai Gazette has recently published an announcement regarding changes to the methodology in which Value Added Tax (VAT) is calculated in Thailand. Below please find an English translation of this announcement:

Page 6

(Official Emblem)

ROYAL DECREE

Issued under the Revenue Code

Regarding Value Added Tax Rate Reduction (No. 646)

B.E.2560 (2017)

————————————-

His Majesty King Maha Vajiralongkorn Bodindradebayavarangkun,

Given on 30 September 2017

of the second year in the present reign.

His Majesty King Maha Vajiralongkorn Bodindradebayavarangkun is graciously pleased to proclaim that:

Whereas it is appropriate to adjust the Value Added Tax Rate Reduction.

By virtue of Section 175 of Constitution of the Kingdom of Thailand and Section 80 of the Revenue Code which amended by Revenue Code Amendment Act (No. 30) B.E. 2534 (1991) Be it; therefore, enacted by His Majesty the King, as follows:

Section 1. This Royal Decree shall be called the “Royal Decree under the Revenue Code, regarding Value Added Tax Rate Reduction (No. 646) B.E.2560 (2017)”

Section 2. This Royal Decree shall come into force on and from the date of 1st October B.E.2560 (2017).

Section 3. The order of the Head of the National Council for Peace and Order No. 65/2559 on the Reduction of Value Added Tax Rate dated on 1st November B.E.2559 (2016) shall be repealed.

Section 4. There shall be reduced the Value Added Tax Rate in accordance with Section 80 of the Revenue Code and shall withhold at the following details;

(1) In the rate of 6.3 percent of sale, service or import in all kind thereof which shall be effective from the date of 1st October B.E.2560 (2017) to 30th September B.E.2561 (2018).

(2) In the rate of 9 percent of sale, service or import in all kind thereof which shall be effective on and from the date of 1st October B.E.2561 (2018).

Section 5. The Minister of Finance shall have the care and charge of this Royal Decree.

Countersigned

Colonel-General Prayut Chan-o-cha

Prime Minister

 

For those interested in viewing the Thai version of the original announcement please click HERE to go to the view the PDF from official website of the Royal Thai Gazette. Please note that this translation is provided for informational purposes only and should not be viewed as a definitive legal interpretation of Thai law.

Two provisions are notable within this announcement, the first is that the VAT is to be lowered from 7% to 6.3% for the next year. Meanwhile, from October of 2018 onward the effective VAT tax rate is apparently to be 9%. This is an overall increase from the current rate of 7% which was the rate prior to the recent announcement.

Tags: Royal Thai Gazette, Taxes in Thailand, Thai VAT, Thailand Accounting, Thailand Tax, Thailand VAT, Value Added Tax, VAT