The Value Added Tax (VAT) is a form of tax levied on the sale of goods or services at each stage of production and distribution, whether they are produced domestically or imported from abroad. According to the Revenue Code, the VAT rate is 10%, but since 2010, a royal decree has been issued to reduce and maintain the VAT rate at 6.3%, plus a tax allocated to local governments at a rate of 1 in 9 of the collected tax, totaling a VAT rate of 7%.

    Entities required to pay VAT are businesses that manufacture or sell goods or services in regular business or profession, regardless of whether the business is operated in the form of an individual, a group of individuals, an ordinary partnership that is not a juristic person, or any other juristic person.

Entities required to register for VAT are as follows:

1. Businesses with income from sales of goods or services exceeding 1.8 million baht per year. Registration must be filed within 30 days from the date the income exceeds this amount.
2. Businesses selling goods or services, which have a demonstrable plan that they have undertaken and prepared for operations that necessitate the purchase of goods or services subject to VAT. Examples include the construction of factories, office buildings, or installation of machinery. A registration application must be filed within 6 months prior to the commencement of operations unless there is a contract or evidence to construct within an appropriate time.
3. Businesses based outside the kingdom and regularly sell goods or services within the kingdom through a representative located in the kingdom. The representative is responsible for registration.

Data updated on November 28, 2020

Source: The Revenue Department, 90 Phaholyothin 7, Phayathai, Phayathai, Bangkok 10400

Tel. +66 2272 8000

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