- The debate on increasing the value-added tax in Thailand has been reignited by Finance Minister Pichai Chunhavajira’s comments on tax reform
- Discussions include possibly raising VAT and reducing corporate and personal income taxes to 15%
- The current VAT rate in Thailand is 7%, which is low compared to 15-20% in many other countries
- Public criticism arose after the minister’s remarks, but Prime Minister Paetongtarn Shinawatra assured via social media that VAT would not increase to 15%
- Critics argue that raising VAT could disproportionately affect low-income groups while benefiting wealthier individuals and corporations
- Thailand’s VAT was initially set at 10% in 1992, reduced to 7% in 1997 during an economic crisis
- The country’s political scene has been dominated by populist policies, leading to a persistent revenue shortfall despite the need for funding social welfare and infrastructure
- Successive governments have faced opposition to VAT increases due to public distrust and concerns over fairness
- Research suggests that VAT is a fair tax and could support social welfare and national development if increased
- Public resistance to VAT hikes often relates to skepticism about the government’s use of the funds
- The government needs to provide a clear, transparent plan for the use of increased VAT revenue to gain public trust and support
Source: bangkokpost.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
