VAT rate to remain 7% until Sept 30, 2018

The value-added tax (VAT) will be kept at the rate of 7% for another year between Oct 1, 2017 – Sept 30, 2018, Revenue Department director-general Prasong Poontaneat said on Oct 3.

Mr Prasong said that according to an announcement published in the Royal Gazette on Oct 2, the exact VAT rate is 6.3% while the local tax is 0.7%, making it 7% in total.

According to the announcement, the 7% VAT on goods and services will be in effect until Sept 30, 2018.

According to the law, from Oct 1, 2018, the VAT will go up to 9%. With the inclusion of 1% local tax, the total will be 10%. In other words, if there is not another postponement, the VAT will be 10% from Oct 1, 2018.

The VAT was introduced in 1992 at a rate of 10%, but was slashed to 7% at the request of business operators. The 7% VAT has since been in effect.

If the VAT rate is increased to 10%, the government would get an increase of 232 billion baht in revenue for fiscal 2018.

However, the cabinet on Aug 15 made a resolution to keep the VAT rate at 7%, although the law puts the VAT ceiling at 10%, for fear that the increase will cause the goods prices and service costs to go up, thus affecting the overall consumption, production, import and private investment.

The post VAT rate to remain 7% until Sept 30, 2018 appeared first on Thai PBS English News.

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