moo9 Posted September 11, 2007 Share Posted September 11, 2007 (edited) This morning I got some information, that the VAT will be increased to 9 % as of Oct 1, 2008. For the interim period from October 1, 2007 - September 30, 2008 a special reduced VAT of 6.3 % will be applied (instead of the current 7 %). My god, they are making things complicated. Has anyone an official information in English yet? PS: Sorry the heading is wrong, not Jan 1st, but Oct 1st 2008 Edited September 11, 2007 by monty Corrected the heading! Monty Link to comment Share on other sites More sharing options...
cclub75 Posted September 11, 2007 Share Posted September 11, 2007 (edited) This morning I got some information, that the VAT will be increased to 9 % as of Oct 1, 2008.For the interim period from October 1, 2007 - September 30, 2008 a special reduced VAT of 6.3 % will be applied (instead of the current 7 %). My god, they are making things complicated. Has anyone an official information in English yet? PS: Sorry the heading is wrong, not Jan 1st, but Oct 1st 2008 No news. But it's the Loch Ness Monster since a long time. Initially, if I remember, it could have been hiked this year. I guess, the Junta -cautiously and wisely- decided that it was probably not the good time... For sure, it will come back. They need it too badly. Right now, VAT is already 40 % of total government revenues. Edited September 11, 2007 by cclub75 Link to comment Share on other sites More sharing options...
xbusman Posted September 11, 2007 Share Posted September 11, 2007 I think it is supposed to be 10% now but is on "special" reduction at least over the past five years. It was scheduled to return to 10% this year but talk about throwing gasoline on a raging fire. They have wisely postponed this for the time being. I would be interested if this is coming up again. Link to comment Share on other sites More sharing options...
cclub75 Posted September 11, 2007 Share Posted September 11, 2007 However, the 6.3 % idea for an interim period sounds totally new. Where have you heard that ? I guess it would have been already an official announcement if it was scheduled for the first october of this year, no ? Link to comment Share on other sites More sharing options...
Irene Posted September 11, 2007 Share Posted September 11, 2007 This morning I got some information, that the VAT will be increased to 9 % as of Oct 1, 2008.For the interim period from October 1, 2007 - September 30, 2008 a special reduced VAT of 6.3 % will be applied (instead of the current 7 %). My god, they are making things complicated. Has anyone an official information in English yet? PS: Sorry the heading is wrong, not Jan 1st, but Oct 1st 2008 No, that is incorrect! The message is the VAT shall remain as 7% from Oct. 1, 2007-September 30, 2008. Thereafter, it will revert to 10% as per statue. EXPLANATIONS: Per Thai tax code, the Vat is to be imposed at 9% but this 9% is subject to an additional tax called Municipality Tax at 10% of the sum of VAT plus municipality tax i.e. 10% of 9 + 1=1. This rate of 9% was stated in the statue right from day one when the VAT was introduced. But the rate has been reduced through yearly decrees to 6.3% up until now. 6.3% is again subject to Municipality Tax at 10% of the sum of VAT plus municipality tax i.e. 10% of 6.3 +0.7= 0.7% and 0.7% + 6.3% = 7%. As for Oct 1, 2008, whether the 10% shall apply depends on the then government whether it wishes to continue to reduce to 7% by then. They have to announce that before Oct. 1, 2008. I also misunderstood that announcement until my legal friend explained the part of municipality tax to me. Yes, they do make life difficult. Link to comment Share on other sites More sharing options...
xbusman Posted September 11, 2007 Share Posted September 11, 2007 I dont think they can get the VAT back up to 10% in this economy. This kind of talk does make it hard to plan, but I am counting on it remaining at 7% through 2008. My accountant reports that the current extension of the 3% reduction is due to expire Oct 1 and is only up for discussion. That would make sense with the fiscal year ending. For a caretaker government, they do seem intent on inflaming a lot of difficult situations without regard to the consequences, lets hope this is much to do about nothing. Link to comment Share on other sites More sharing options...
moo9 Posted September 11, 2007 Author Share Posted September 11, 2007 (edited) Hi, confusing issue. My staff send me this document today, sorry I can't read Thai. Maybe we have somebody here for proper translation, to enlighten us.... tax.pdf Edited September 11, 2007 by moo9 Link to comment Share on other sites More sharing options...
andy1308 Posted September 11, 2007 Share Posted September 11, 2007 Hi,confusing issue. My staff send me this document today, sorry I can't read Thai. Maybe we have somebody here for proper translation, to enlighten us.... I had the same document supplied to me late yesterday evening, and from what I have been told it says the rates will reduce to 6.3% from 1st October 2007 until 30th September 2008 for product sales and services. Of course this being Thailand it's only become apparent three weeks before implementation. Link to comment Share on other sites More sharing options...
Firefan Posted September 11, 2007 Share Posted September 11, 2007 Prices have went up fast in the last several years. I do certainly not believe the official inflation nos (around 5%/year) at all, and neither do my Thai friends. The vat is an end consumer tax, meaning that the end impact on the consumer will normally be more than the 7 or 10% due to "tax on tax" in the production/supply chain. In short; higher prices for most, but worst for the end consumer. Not pretty. Cheers! Ps. now we can wait for the first poster to bring up how little 10% is compared to the 20-25% in their home country....sigh.... Link to comment Share on other sites More sharing options...
Naam Posted September 11, 2007 Share Posted September 11, 2007 The vat is an end consumer tax, meaning that the end impact on the consumer will normally be more than the 7 or 10% due to "tax on tax" in the production/supply chain. the sky is falling. for sure! Link to comment Share on other sites More sharing options...
Firefan Posted September 11, 2007 Share Posted September 11, 2007 He,he - probably not Dr. Naam, simply another inflation booster on top. Cheers! Link to comment Share on other sites More sharing options...
Irene Posted September 11, 2007 Share Posted September 11, 2007 I dont think they can get the VAT back up to 10% in this economy. This kind of talk does make it hard to plan, but I am counting on it remaining at 7% through 2008. My accountant reports that the current extension of the 3% reduction is due to expire Oct 1 and is only up for discussion. That would make sense with the fiscal year ending. For a caretaker government, they do seem intent on inflaming a lot of difficult situations without regard to the consequences, lets hope this is much to do about nothing. You got your wish of 7% up to Sept 2008. Link to comment Share on other sites More sharing options...
moo9 Posted September 11, 2007 Author Share Posted September 11, 2007 Hi,confusing issue. My staff send me this document today, sorry I can't read Thai. Maybe we have somebody here for proper translation, to enlighten us.... I had the same document supplied to me late yesterday evening, and from what I have been told it says the rates will reduce to 6.3% from 1st October 2007 until 30th September 2008 for product sales and services. Of course this being Thailand it's only become apparent three weeks before implementation. Wait and see, I asked my people to investigate further. Well Oct 1st is coming soon, we need to know well ahead to adjust our system. Amazing Thailand. Link to comment Share on other sites More sharing options...
Naam Posted September 11, 2007 Share Posted September 11, 2007 He,he - probably not Dr. Naam, simply another inflation booster on top. Cheers! will the VAT be "racist" and hit us farangs only? Link to comment Share on other sites More sharing options...
cclub75 Posted September 11, 2007 Share Posted September 11, 2007 I had the same document supplied to me late yesterday evening, and from what I have been told it says the rates will reduce to 6.3% from 1st October 2007 until 30th September 2008 for product sales and services. Of course this being Thailand it's only become apparent three weeks before implementation. Holly Molly ! Could you scan this doc ? Link to comment Share on other sites More sharing options...
Firefan Posted September 11, 2007 Share Posted September 11, 2007 Huh? Did I indicate that somehow? I even mentioned my Thai friends complaining about fast (faster than official inflation nos) rising prices. That said; the consumers (be it Thai or foreigners) who spend the most will be impacted (measured in Baht) the most of course. Also; the ones that spend in shops/supermarkets that actually use/report VAT will of course be affected more than people shopping at "no tax" markets or swapping a goat for 5 chickens (I think that is the going rate ). Cheers! He,he - probably not Dr. Naam, simply another inflation booster on top. Cheers! will the VAT be "racist" and hit us farangs only? Link to comment Share on other sites More sharing options...
cclub75 Posted September 12, 2007 Share Posted September 12, 2007 False alert. Actually, there is a change of the repartition... Revenue Dpt will give 6.3 % of VAT to Finance Ministry and 0.7 % to the... local government. Therefore, total rate doesn't change and stay at 7 %. Link to comment Share on other sites More sharing options...
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