Transcript of the above video:

As the title of this video suggests, we are discussing VAT or Value Added Tax. For those who are unaware, Thailand has a VAT system. In some places I believe this is called General Sales Tax. In Britain I believe they have VAT, it is a value-added tax. A lot of people believe that the rate is 7% in Thailand which as a practical matter it is but there are some nuances to that.

In a recent article from the Bangkok Post, bangkokpost.com, the article is titled: Government Spends its Way into Trouble. It is written by Chartchai Parasuk. This gentleman, Mr. Chartchai, in my opinion he writes a lot of good stuff for the Bangkok Post especially on the Thai economy. I find his work pretty insightful. I believe he used to work for the IMF so it makes some sense that he would have some insight into economics. 

Quoting directly: "The Government could raise more revenue like increasing VAT from 7% to 10% to bring in an additional 300 billion Baht in tax income. I do not see this happening either as it would create opposition from the public, especially low-income groups. By the way, many may not know the official VAT rate is 10%."  Yeah, I have done other videos on this channel. In fact some people got actually mad at me for bringing this up but yes, technically it is 10% and then it was implemented, they on a yearly basis have set it at 7% and technically the 7% is temporary and they continue to keep it at that rate but it is on a temporary basis; it is sort of a provisional basis. Technically speaking the rate should be 10%.

Now that has got major political ramifications to raise it up and so it kind of remains to be seen as to whether or not you would actually see a change in that but it is something to keep in mind that VAT is actually 10% in Thailand. It doesn't take very much for that to be raised. Again just one way of doing it would be just not signing an extension of the temporary current 7% amount; the temporary order keeping it at 7%. Failing to sign that results in the thing essentially reverting back to originally what it was said to be which was 10%.

Now as he notes, I don't think this is overly likely but it could happen and especially where you have got budget issues and spending issues associated with the economy especially as we are dealing with the aftermath of this response to COVID-19. Exactly how this is going to play out remains to be seen but I do find it interesting that there is a misnomer out there as to what the exact rate of VAT is in Thailand. Yes 7% is the practical rate but technically speaking, 10% is what it is supposed to be.