Thailand to start collecting tax from foreign tech firms

[snoop1130]

FILE PHOTO: FILE PHOTO: The logo of Google is seen at the high profile startups and high tech leaders gathering, Viva Tech,in Paris, France May 16, 2019. REUTERS/Charles Platiau/File Photo

 

BANGKOK (Reuters) - Thailand on Wednesday will start collecting value added tax (VAT) from foreign technology companies and expects to raise at least 5 billion baht ($154.70 million) in additional revenue each year, a senior official said.

 

Foreign platforms providing electronic services in Thailand will have to register for VAT payments, senior finance ministry official, Ekniti Nitithanpraphas, told reporters.

 

So far 69 companies have registered from a target 100, according to Ekniti.

 

The companies are divided into five categories including platforms getting income from e-commerce and advertising like Facebook and Google, intermediaries such as ride-hailing app Grab have and streaming services such as Netflix, he added.

 

Companies with revenue of over 1.8 million baht will have pay VAT of 7%, which has to be paid every month, he said.

 

The ministry's target of 5 billion baht of additional revenue is a minimum because that goal was derived before the pandemic.

 

Thailand collects about 800 billion baht annually from VAT.

 

Last week, the government approved an extension of the current 7% VAT rate until September 2023. The VAT rate has been at 7% since the 1997-98 Asian financial crisis.

 

-- © Copyright Reuters 2021-09-01

 

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[ukrules]

Of course VAT is reclaimable by commercial entities so this is merely an indirect tax on consumers.

 

All this will do is increase prices and inflation.....nice!

[mrfill]

And just how much will this affect Google? ....

 

Not much

 

https://www.globalgroundmedia.com/2020/07/19/94-percent-of-asian-revenue-attributed-to-google-singapore/

[itsari]

What are the extra costs with Airbnb ? I understood that the service fee paid by the guests would invite the 7 percent vat . Is the service fee just the percentage Airbnb is charging ? Or is that including the rental fee paid?

[Peterw42]

Maybe someone needs to explain to these guys how the internet works. I can find, pay, use, subscribe to goods and services on servers and platforms all over the world. Its got stuff all to do with Thailand, and good luck taxing it.

[Bangkok Barry]

And if Google and Facebook don't pay up, what then?

[Caldera]

Large companies really have no other option than to comply. A US based company just sent me an email saying that they'll start to collect Thai VAT for their services.

 

[Sydebolle]

Well, well, get ready for price increases as all this will be passed on to the esteemed customer base on a one-to-one basis; if you're lucky! 

[hotchilli]

4 hours ago, Bangkok Barry said:

And if Google and Facebook don't pay up, what then?

Nothing, if Facebook say no or bye bye Thailand the ministers will have nothing to play with in parliament.