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%.Â 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.Â 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.
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