A requirement for online platform operators to submit sellers’ income statements to the Revenue Department should increase tax revenue by roughly 10 billion baht, says Lavaron Sangsnit, permanent secretary of the Ministry of Finance.
The new reporting rules, which took effect on Jan 1, apply to digital platform operators registered in Thailand with annual revenue of more than 1 billion baht. Businesses already supervised by the Bank of Thailand or the Stock Exchange of Thailand will not be subject to the rule.
Having operators allow the Revenue Department to collect information on sellers’ earnings from online activities is expected to nudge more online product and service providers into the tax system.
Digital platforms have been major economic disrupters in recent years, especially during the pandemic. They have the potential to positively impact 540 million people in the world and increase revenue by $2.7 trillion by 2025, according to McKinsey Global Institute.
But their design often hinders traceability and detection of taxable events by authorities, causing a loss in tax revenues and creating an unequal playing field for vendors that do pay taxes.
“I encourage online product and service providers to enter the tax system,” said Mr Lavaron.
“The world is getting smaller, more connected and traceable because of digitisation. In the past, it may have been impossible to detect tax evasion, but now it can be easily detected.”
In the 2023 fiscal year, the Revenue Department brought in 2.21 trillion baht, exceeding its target by 182 billion. The total comprised 767 billion baht in corporate taxes, 913 billion in value-added tax (VAT), and 395 billion in personal income tax.
Eleven million people filed personal income tax forms, while corporate income tax filings tallied about 600,000 and VAT registrants totalled 800,000.