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Oversea Foreign websites to pay VAT

Around 20 large overseas online platform operators plan to register as value-added tax (VAT) payers in Thailand, says Ekniti Nitithanprapas, director-general of the Revenue Department.

The move comes in response to enforcement of the e-service tax law from Sept 1, when overseas businesses providing online services in Thailand will be required to register for 7% VAT liability if their annual income exceeds 1.8 million baht.

E-service businesses liable for VAT payments include those offering download services for movies, games, stickers, brokerage services and advertisements.

He said the department already developed an online channel for operators to easily register for VAT and make payments.

Most foreign online businesses are cooperating with the law, Mr Ekniti said.

The department expects tax revenue collection from the upcoming e-service levy to total more than 5 billion baht per year as the pandemic has moved traffic to online platforms, he said.

Under the tax law, operators estimate how much tax they should pay.

The department uses a post-audit process to examine their VAT payment by seeking international cooperation among countries on their tax payment records.

Around 60 countries have adopted this e-service tax.

The department is pushing for the enactment of organic laws in e-service tax law.

The details of the organic bills have been approved by the cabinet and are being scrutinised by the Council of State.

The introduction of the e-service tax law is part of the country’s ongoing tax reform to improve revenue and ensure fair treatment for all.

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