Regulatory updates - Thailand

Under this framework, the current temporarily reduced VAT rate of 7% will increase to 8.5% in fiscal year 2028, followed by a complete elimination of the current VAT rate reduction and an increase to 10% in fiscal year 2030.

This tax adjustment forms part of Thailand's fiscal consolidation strategy, which aims to reduce the fiscal deficit to below 3% of GDP by 2029. The Bureau of the Budget and the Ministry of Finance are currently developing operational details for implementing these changes.

On September 14, 2025, the Royal Decree issued under the Revenue Code was published in the Thai Royal Gazette, extending the temporary reduction of the Value Added Tax (VAT) rate. The Thai Ministry of Finance, through the Revenue Department, had previously announced this measure on September 9, 2025.

The decree reduces the VAT rate from 10 percent to 6.3 percent, or 7 percent including local taxes, for the sale of goods, provision of services, and imports. This reduction applies to all cases from October 1, 2025, until September 30, 2026.

The continued VAT rate reduction aims to maintain and support national economic growth, facilitating the ongoing expansion of the Thai economy.

The continued VAT rate reduction aims to maintain and support national economic growth, facilitating the ongoing expansion of the Thai economy.

This extension will be in force from October 1, 2025, through September 30, 2026.