What is VAT?
VAT (Value Added Tax) is an indirect tax collected from consumers through purchases of goods and services. Thailand currently collects VAT at 7% (the legal rate is 10%, reduced to 7% by royal decree).
VAT Calculation Formulas
- VAT from pre-tax price: VAT = price × 7%
- Price including VAT: total = price × 1.07
- Extract VAT from total: pre-tax = total ÷ 1.07
Who Must Register for VAT?
Businesses earning over 1.8 million THB per year must register, issue tax invoices, and file monthly returns.
VAT-Exempt Items
Some goods/services are exempt: unprocessed agricultural products, domestic transport, educational services, healthcare, and real estate rentals.