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  • Thailand Taxes : Tax Rates Comparison Tables

    June 29 2013

    I recently read an article in the Bangkok Post were a Revenue Department Official was quoted discussing the matter of a possible corporate income taxes reduction. This official was saying that while corporate income tax may be higher than in other countries Thailand was however one of the country in the world where the VAT rate was the lowest.  This gave me the idea to compare the ranking of Thailand in relation to personal income tax, corporate income tax and VAT.

    The results given hereinafter are to be taken with prudence. Firstly, while there are several sites who collect this type of information not all have updated information. While I tried to collect the most recent data’s I might have missed something.

    Personal Income Tax Comparison Table

    In term of taxation of personal income tax, Thailand ranks 82 out of 119 countries.

    PERSONAL INCOME TAX: HIGHEST MARGINAL TAX RATE COMPARISON

    ITEM

    Rank out    of 127

    Maximum Rate Applicable

    World Average Rate

    Differential

    Paraguay

    1

    10%

    32.5%

    - 22,5 %

    Macau

    4

    12%

    32.5%

    - 20,5 %

    Thailand

    82

    37%

    32.5%

    + 4,5%

    China

    102

    45%

    32.5%

    + 12,5%

    Cameroun

    119

    60%

    32.5%

    + 27,5%

     I believe however that those results are in some way unfair to Thailand because they are based on the highest tax rate applicable.

    Thailand Taxes : Tax Rates Comparison Tables

    Now, Thailand like many countries has a progressive personal income tax rate that start from exempt to 37%. In Thailand the maximum rate that is 37% will kick in only for individuals who have an income in excess of 4,000,000 THB (120,000 USD). Thai employees with an income of less than 12,500 THB per month will not paid income tax at all and most Thai people will not be concerned by this maximum rate.

    Corporate Income Tax Comparison Table

    As to corporate income tax Thailand ranks 62 out of 127 countries surveyed with a maximum rate of corporate income tax of 30%.

    CORPORATE INCOME TAX: HIGHEST TAX RATE COMPARISON

    ITEM

    Rank out    of 127

    Maximum Rate Applicable

    World Average Rate

    Differential

    Kuwait

    1

    6%

    27.2%

      – 21.2%
    Macau

    5

    12%

    27.2%

     - 15.2%
    Thailand

    62

    30%

    27.2%

      + 2.8%
    Philippines

    104

    35%

    27.2%

     +7.8%
    Saudi Arabia

    125

    45%

    27.2%  +17.8%

     

    It has to be noted that 88 countries out of 125 surveyed have corporate income tax between 25 to 35% ant that there are 28 countries in the world that have as Thailand a 30% Corporate Income Tax rate.

    But for Hong Kong (17.5%) and Singapore (20%) most Asian Countries are within a tax corporate income tax bracket from 28 to 35%.

    VAT and/or GST comparison Table

    Here again it was difficult to built a comparison table because there are still many countries that do not have VAT or GST type of taxes or there are countries like for example Hong-Kong where the GST rate is 0%.

    It is however true that out of 40 countries surveyed that use the VAT or GST system Thailand has one of the lowest VAT maximum rates applicable at 7%. Note however that Thailand rate for the VAT is actually by law of 10% and that the current rate of 7% is only applicable as part of measures taken after the 1997 crisis and shall be applicable only for as long as said measure is extended every year by the government.

     

    VAT and/or Consumption Tax:                                                        HIGHEST TAX RATE COMPARISON

    ITEM

    Rank out of 40

    Maximum Rate Applicable

    Taiwan

    1

    5%

    Thailand

    3

    7%

    Philippines

    7

    12.%

    Hungary

    38

    25%

     

    Note: This page is an excerpt of Rene Philippe Dubout next book: “How to Safely Invest Into Thailand” to be published in December 2009

    About the Author:

    The author Rene-Philippe DUBOUT is a lawyer since 1990 when he was admitted to Geneva bar (Switzerland). He practiced as a litigator there for 10 years until he moved to Thailand in 1999. In 2002 he founded with a group of Thai lawyers Rene Philippe & Partners Ltd a local law firm that specialized in Cross Borders Investments and Real Estate. He has been lecturing in several Thai Universities and a speaker to numerous conferences and seminars. He is the author of a must read book:”How to Purchase Real Estate Offshore Safely: The Case of Thailand”.

    http//:www.renephilippe.com

      

    © Copyrights 2009 – Rene Philippe Dubout – This article may be reprinted if information about the author, the websites, and the URLs remain intact.

    Originally posted 2009-10-11 06:54:42.

    Thailand Taxes : Tax Rates Comparison Tables

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