Cabinet freezes VAT at 7 percent for another year

The Cabinet today decided to maintain the value-added tax at 7 percent for another year as of October 1.

 

Mr Natthaporn Jatusripitak, spokesman of Deputy Prime Minister Somkid Jatusripitak, said the Cabinet was concerned that increasing the VAT rate might impact the overall economy, investments and domestic consumption.

 

Increasing the VAT rate above 7 percent as the country’s economic performance is improving would slow down the economy and push up the prices of consumer products and services, said Natthaporn, citing the cabinet’s concern.

 

The freezing of VAT rate at 7 percent for another year will cause the state to lose 258,500 million baht in revenue, but this will not impact on the government’s budget for 2019 fiscal year, noting that the government has opted for deficit budget next year.