The Thai government has reportedly issued a second draft of its proposal to subject foreign suppliers of e-services to value added tax (VAT). The government is not planning to move forward with plans to introduce a withholding tax or expand the scope of taxable presence (PE) rules in order to directly tax foreign e-commerce sales into Thailand, but such approaches could be reconsidered in the future.
The latest proposal provides that foreign suppliers will be required to register and account for VAT in Thailand on e-service supplies made to non-VAT registered persons if such supplies exceed THB 1.8 million per annum. While generally focused on B2C supplies, B2B supplies would also be subject to VAT unless the customer providers their Thai VAT number. The rules will also apply for supplies made via a foreign online platform, with the platform operator required to register and account for VAT if the THB 1.8 million threshold is met.
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