How Much Are Street Vendors (food) Taxed?

[craigtraveller]

Here in Bangkok there's a women who I buy a chicken/noodle or chicken/rice meal from pretty much each day. She and her husband run typical chicken/noodle cart at an intersection for 10 hours a day, and work 13 days for every 14. I'd estimate they probably pull in well over 5000 baht/day in business.

They're obviously very hard working, and for curiosity's sake, was trying to estimate exactly how much they're making. I found some references online that say over 40% of Thailand's GDP is made up from street vendors, and that they're not taxed. But then again, there's personal income tax to consider. I also read that such things are capped at 60,000 THB for most, or 0.05% of earnings for others. Is this correct?

I suppose I was just curious exactly how much food vendors like these actually get to retain of their earnings, after expenses...

Edited August 9, 2009 by craigtraveller

[kalasin]

I am very sure that the street vendor you talk about doesn't pay any tax - to the goverment that is.

But even though it sometimes might look as if the vendors are placed ramdomly they are not.

They will pay rent for that very spot where the vendor is. And if it is a popular spot like the one you saw, and they sell fro aprox. 5.000 baht a day, I would not be supriced if the rent was 2.500 baht a day.

[dondraper]

ur source is wrong. 40% lol?

[sanmiguellight]

ur source is wrong. 40% lol?

Why not correct him and give him the correct rate of tax for such an amount earned from your wonderful source.

From other posts im guesstimating the amount is about 12%, but i for one hope they dont pay a satang in tax!

[krading]

Imagine the bureaucracy problems here if the Thai street venders had to to go through all the licensing, permits, health inspection, BAS (business activity statement) crapola that they have to in 'developed' countries.

Here you pay no tax and you get no social benefits. Much less complicated.

[samran]

If they are set up in an area where they have a permit, then they'd be those registration costs.

Depending on the area, the local tesakit (municipal policemen) likes a cut too, but from what I understand, this varies.

The tax structure allows for people in this situation to set themselves up as a sole trader. Effectively this means they can write off 70 to 80% of their revenues as costs, automatically and without a recepit. The remaining 20% is considered their personal income, and taxed according to their personal liablity.

Whether they register or not is another story, but I've heard and seen that the revenue department is gradually working its way down the ranks to make sure people are registered.

[craigtraveller]

ur source is wrong. 40% lol?

Oops -- for that one I was looking at the deductions allowed, though the tax brackets are: Exempt, 10%, 20%, 30%, and 37%

http://bangkok.angloinfo.com/countries/thailand/intax.asp

--- Thanks for the replies all.

Edited August 9, 2009 by craigtraveller

[johnson36]

If a Thai wants to set up a food or drinks stall can they do this if they rent a small piece of land from the owner of the land (ie: not on the road). Would there be any licenses needed ?

[oevna]

If a Thai wants to set up a food or drinks stall can they do this if they rent a small piece of land from the owner of the land (ie: not on the road). Would there be any licenses needed ?

A Thai friend of mine ran a small drink stand (beer and cocktails) in Bangkok along a street that was lined with various food, drink and craft vendors, and there was some sort of permit required. I don't know the details though. The cops would periodically pass through and ask for tea money from anyone who couldn't produce their permit.

[Colonel_Mustard]

They're obviously very hard working, and for curiosity's sake, was trying to estimate exactly how much they're making. I found some references online that say over 40% of Thailand's GDP is made up from street vendors, and that they're not taxed.

I find it very hard to believe that 40% of Thailand's GDP is made up from street vendors.

[losworld]

I am very sure that the street vendor you talk about doesn't pay any tax - to the goverment that is.

But even though it sometimes might look as if the vendors are placed ramdomly they are not.

They will pay rent for that very spot where the vendor is. And if it is a popular spot like the one you saw, and they sell fro aprox. 5.000 baht a day, I would not be supriced if the rent was 2.500 baht a day.

2500 baht per day for a street vendor? Seems ridiculously high.

[Rionoir]

2500 baht per day for a street vendor? Seems ridiculously high.

Did anyone see that story recently about a HOT DOG vendor in New York who was being "evicted" from the steps of the metropolitan museum of art because he was behind on his rent of $54,000 USD a month!?!?  Talk about ridiculously high rent. LoL

I think the street vendors in certain areas pay a lot more though cuz of the mafia or whatever, like Silom...

[way2muchcoffee]

Once looked into street-shop clothes vendors. Rents varied from 300-1500 daily, depending on location. That was rent only and didn't include any police or mafia tea monies which was information we were unable to obtain.

[Farma]

Upcountry the wife leases out footpath space in front of her business. Obviously the amount isn’t as high as the prices being quoted for Bangkok. She allows 3 vendors only and picks vendors that will be beneficial to her business. One of the deals includes her supplying electricity to the street vendor and keeping the outside lights on until 10 PM.

The vendors pay the local official for a permit.

The tax paid by the street vendors is similar to what samran described.

[TAWP]

I am very sure that the street vendor you talk about doesn't pay any tax - to the goverment that is.

But even though it sometimes might look as if the vendors are placed ramdomly they are not.

They will pay rent for that very spot where the vendor is. And if it is a popular spot like the one you saw, and they sell fro aprox. 5.000 baht a day, I would not be supriced if the rent was 2.500 baht a day.

2500 baht per day for a street vendor? Seems ridiculously high.

PatPong, the evening-sellers, pay some 5k baht per table/night iirc.

The family owning the street is the one becoming really rich...

[mahtin]

PatPong, the evening-sellers, pay some 5k baht per table/night iirc.

The family owning the street is the one becoming really rich...

Found this on wiki

Patpong gets its name from the family that owns much of the area's property, the Patpongpanich (or Patpongpanit), immigrants from Hainan Island, China, who purchased the area in 1946. At that time it was an undeveloped plot of land on the outskirts of the city. A small klong (canal) and a teakwood house were the only features. The family built a road - now called Patpong 1 - and several shophouses, which were rented out. Patpong 2 was added later, and both roads are in fact private property and not city streets.

Fascinating.

[stolidfeline]

Since several of my friends have food stalls, here's something from their own experiences.

You can take a mobile stall (pushing it around) almost anywhere with few "overheads", but the sales are lower. If you want good sales, you need a good site. You can set up on the sidewalk, but then you have to pay the "tessakit" a monthly "rent". After that, there may be local mafia. And tea money to police. While most people are left alone, it's in the lap of the gods. You're vulnerable.

If you can, it's best to rent private space in front of a shop. Then you can also rent electricity. Usually no problems with police or tessakit. But the shop owners are usually greedy, grasping bloodsuckers who figure out what your likely income may be and demand that much for the rent. This rent can be extremely high. Typical rent is 5000 baht/month upwards depending on the position. And yes, some do work out around 2500 per day - but it's not possible to make money from selling food. Nor anything else these days. Renters usually go bankrupt very quickly at such places. [There is one famous spot in Pratunam which charges variously between 75,000 and 120,000 baht a month for a 2m x 1m spot].

As far as sales go, you can make good money if you are lucky with everything and you are in the right spot. But the majority of people just make enough to live on and not much more. However, one friend sells 700 bits of blackened, inedible beef on a stick each night at 10 baht each, from a mobile cart. You can see he's doing OK - but it's long hours.

At the moment, everyone's income is way down. People's spending, even on street food, is much lower than it used to be before all of the political hanky-panky, and the almost total loss of tourism spending has not helped anyone either.

Oh, and when I mentioned paying tax, everyone howled with laughter.

Edited September 22, 2009 by stolidfeline