New Thai Income Tax Postponed
We reported earlier this month on the Thai government’s decision to make a number of changes to personal income tax. Since going to press, the Thai government has gone through a time of political unrest, which will likely delay the income tax rate from taking effect in the 2013 tax year.
If you read our previous article, you’d know that last month the cabinet issued a royal decree to ensure the revised personal income tax structure would take effect in the current tax year 2013. However, the royal decree has not been submitted for royal endorsement yet, which is likely to delay efforts.‘If we can’t complete the legal process by Dec 31, the new tax rate will be delayed until tax year 2014 at the earliest, said Finance Ministry permanent secretary Rangsan Sriworsart.
What Are The Proposed Changes To Thailand’s Income Tax?
Under an executive decree approved by the Cabinet at the end of November, the number of income tax brackets will be expanded from five to seven during the 2013 and 2014 tax years, while the maximum tax rate was lowered from 37 per cent to 35 per cent.
The new 5% rate will be applicable to those earning between 150,000-300,000 baht a year, with 10% for those who earn 300,001-500,000 baht, 15% for 500,001-750,000 baht, and 20% for 750,001 baht to 1 million.
What Does This Mean For Thailand?
The changes in income tax would have meant lower payments, particularly for middle-income earners, who are the most likely to benefit from the new plan. If the plan doesn’t take effect the Thai economy is liable to remain in it’s sluggish position.