Thailand to raise VAT to 8% 2015
Thailand has raised the possibility of a 1% VAT rise to 8% in September 2015 if the economy continues to recover.
Following the military takeover in 2014, the economy has turned around, and is now growing by over 2% – the government is targeting 4% GDP growth. VAT revenues are already up over 10% since January 2014 indicating returning consumer confidence.
Thai VAT was 10% until the late 1990’s when the Asian financial crisis hit the region, and the consumption tax was cut to the current 7% to help support the economy. There has been repeated discussion since then of a return to the 10% rate. The current government hopes to achieve this within the next few years. However, it also has an eye on its close economic competitor, Singapore, which has a 7% Goods & Services rate.