Thai Revenue Dept. proposes keeping 7 percent VAT for another year

[webfact]

Revenue Department proposes keeping 7 percent VAT for another year



BANGKOK: -- The Revenue Department has proposed the Finance Ministry to extend the 7 percent value-added tax (VAT) and 20 percent corporate tax for another year in order to ease burden on consumers and corporations due to the current economic slowdown.

Mr Sutthichai Sangkhamanee, director-general of Revenue Department, said the last two-year extension of the two types of taxes, formerly rated at 10 percent and 23 percent, was due to expire on this September 30 and another extension has to be done now because it needs the approval of both the cabinet and the Election Commission.

The EC, he explained, will determine whether the tax cut extension will be deemed as breach of Article 181 of the Constitution or not.

Mr Sutthichai said normally each extension would last two years but, this time, it would last just one year because this government would not place the new government into a commitment for too long.

He believes that the EC will have objection to the Revenue Department’s proposal because if the VAT is to be charged at 10 percent like before many consumers will be affected as the prices off every consumer products will increase accordingly.

Mr Suthichai said that the Fiscal Economics Office had suggested that the old 10 percent VAT rate be reintroduced as every one percent increase would generate 70-80 billion baht in revenue annually for the state. But he thinks that increasing VAT for the time being is untimely with the depressed economic situation.

Revenue collection for the first five months of the 2014 fiscal year amounted to 802,000 million baht representing a 0.6 percent drop or 4,679 million baht short of the target.

Source: http://englishnews.thaipbs.or.th/revenue-department-proposes-keeping-7-percent-vat-another-year/


-- Thai PBS 2014-04-14

[Thai at Heart]

Its incredible that it is the Revenue department makes any public recommendation at all.

What a departure from the Western world.

a 0.6 percent drop or 4,679 million baht short of the target.

Why is it his job to wonder about whether the tax burden is too high or too low for the public and businesses?

[DrTuner]

If you ask the revenue department, they ought to say tax 'em at 100% or more.

[kingalfred]

Where has thailand spend its "tax revenues" in recent times.

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[chotthee]

VAT is too low in Thailand.

The rich is not paying enough.

Let increase to 20% (from 7%), so the rich can pay more.

[Thai at Heart]

VAT is too low in Thailand.

The rich is not paying enough.

Let increase to 20% (from 7%), so the rich can pay more.

This is what will have to happen, since they seem very much against raising taxes on income or corporate earning.

[kingalfred]

VAT is too low in Thailand.

The rich is not paying enough.

Let increase to 20% (from 7%), so the rich can pay more.

ahhh just as osborne did in the uk.and you think it only penalizes the rich .Ask a few low income brits who cant afford the goods and services with one fifth if it in tax .

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[bigbamboo]

VAT is too low in Thailand.

The rich is not paying enough.

Let increase to 20% (from 7%), so the rich can pay more.

Except it wouldn't work out that way. Whilst the common man would then have to pay 20 per cent the very rich would still find ways to avoid. You know how cunning these elites are at dodging taxes.

[nkg]

VAT is a regressive tax.

There is no chance of it being raised right now - poor Thais would riot if it went up to 20%.

Chotthee is completely wrong - rich Thais invest most of their money, they don't spend it at the 7/11.

[Scarpolo]

you cannot dodge a user tax.

[Thai at Heart]

At uote name="kingalfred" post="7689488" timestamp="1397481687"]

VAT is too low in Thailand.

The rich is not paying enough.

Let increase to 20% (from 7%), so the rich can pay more.

ahhh just as osborne did in the uk.and you think it only penalizes the rich .Ask a few low income brits who cant afford the goods and services with one fifth if it in tax .

Sent from my iPhone using Thaivisa Connect Thailand mobile app

This is what countries will do in future. Larger tax free allowances, but higher VAT.

It closes the black economy and at least gives the appearance of not penalising the poor. Either way, in the UK, the poor don't pay so much income tax, but the pay on the consumption end. Have to pay somehow.

Would you prefer no VAT,but take away the allowances?

[dieter1]

my home country:

middle income, privately employed:

about 20 up to 35 % income tax

about 39 % for socialsecurity

19 % VAT

it summs up to 80 % ( you have to take income as 120 % because of

calculation of social security contribution (50% employer, 50 % employee)

so it is about 66 % taxation and social security contributions for normal working people

66 % !!!!!!!

for high income people it is just maximum 42 % income tax. The more people earn the less

they pay tax (tax evasion ...), they are not forced to pay for social security.

The higher the income ,the less paying for VAT! VAT is what you pay, if you need to spend

every single baht at the next shop to keep youself and your family to survive.

If you are rich, you use big parts of your money for investment and do not pay a single baht VAT

for that. You can use your money to spent in countries, where you have to pay nothing or less for VAT

(F.e.).

conclusion:

VAT is a tax to make high earners pay less tax (contribute less to the society) and to

press more money from low earners.

f. e.: even if your income(wage) is not enough to feed your family (say 8000 Baht for a Family)

you have to pay 10 % VAT (800 Baht).

This happens all over the world: The tax for low earners getting higher and higher

and the tax for the rich is getting lowered.

The oligarchs (small groups of families, people in control) in the countries love this kind of tax,

cause for the stupid masses this tax is kind of covered. And it mostly hurts the poor people/ low earners.These people have no influence, no power so there is litle resistance, if this tax is been raised. In western countries like the USA and western European countries, the maximum income tax has been lowerd and the VAT has been raised up in the last decades.

Edited April 14, 2014 by dieter1

[alfalfa19]

I always assumed that the VAT was just another thai scam. Admittedly, I don't know how it works. All I know is that I have had to pay it many times, in restaurants, etc, and never had any opportunity to get any of it back. Supposedly we're supposed to get it back, are we not?

[brain150]

A low income Thai does NOT pay personal income tax !!!

But he has no way out of VAT !!!

If you increase VAT it hits EXCLUSIVELY the LOW INCOMES !!!

It NEVER affects the rich !!!

Please try to understand what you are talking about and you might find out

that ALL taxes are only for low and medium incomes.

The rich can invest their money and due to interest and the interest on the interest

they are NOT part of the paying tax population.

From a certain amount of port folio on wards the rich fall completely out of the

taxes as their interests will cover the taxes plus leave a surplus.

Taxes are designed for the poor to keep them suffering .... simple and easy like this !!!

[marko kok prong]

The one thing you can be sure of with vat or gst as they call it in Australia is that it will creep up and up from the percent it is introduced at,but i must say this seems a good decision from the revenue dept.

[tingtongteesood]

In the uk, by the time you have paid the direct government taxes, national insurance and VAT on everything you buy, around 40% of your earnings are gone already - just in taxes ! Not to mention special taxes on petrol, cigarettes and alcohol and whatever other 'stealth taxes' are hiding. It's really ridiculous !! Taxed to the hilt !

[GlobalCtzn]

VAT is too low in Thailand.

The rich is not paying enough.

Let increase to 20% (from 7%), so the rich can pay more.

VAT is a consumption based tax that disproportionately taxes the poor. If you really want to tax the rich more you do not do that effectively with any consumption based tax.

Capital gains tax, top levels of a sliding scale income tax, are example of taxes that affect the rich and do not touch the poor too much.

[jagriffin2]

Seems to me that stats show the less you tax, the more people are willing to spend. The world right now is taxing the HELL out of its citizens so why not become a tax haven for those willing to move here and spend their money FREELY?