Thai tax system and economy model.
- The annual income of the company/factory employees up to 150,000 baht is exempt from tax.
Income between 150,000-300,000 5% tax. That is, an income tax of 10,000 baht per year is deducted from the salary of a Thai employee whose annual income is 300,000 baht .
- It is subject to tax declarations of Thai people who work in their own shops or who are street vendors, and in most cases street vendors do not make any declarations, and the state does not force the small tradesmen and street vendors to pay tax. You will never see Thai finance officials going to the small shopkeepers for inspection. The state does not require a lot of formality from state vendors, nor does it collect fees, taxes, etc. Most tradesmen that foals can do is closed to foreigners. Foreigners cannot work as vendor, barber, Thai restaurants, lawyers, etc.
- The weight of the taxes is focused on large enterprises, hotels, factories, places that employ foreign partners or non-asean foreign personnel.
- VAT is a flat rate of 7% on everything. Acidic beverages such as alcohol, cigarettes and cola are exceptionally high VAT.
-Import duties are variable. There is a heavy import tax on the imported version of every item that can be produced domestically. The tax rate has been adjusted in order not to bring the imported product cheaper than the domestic product. Everything that goes into luxury consumption is also under high import tax. Example: You cannot import a car cheaply from outside, as we manufacture cars and pick ups in Thailand. Since cars like BMW are considered luxury, there is a heavy import tax. It is forbidden to use imported vehicles in public institutions. There is no authority tool given for personal use. Except for vehicles intended for the use of the royal family and ministers and foreign diplomatic guests.
- Thai citizens can open a foreign currency account at the bank, but can transfer foreign currency only from abroad. They can not deposit foreign currency in a bank account within the country. Foreign exchange can also be withdrawn as Thai baht. (Those who will go abroad can document and buy foreign currency from banks). Thai citizens cannot rent in foreign currency, and cannot make commercial sales with currency index in the country.
- Foreigners cannot buy land or houses. Foreigners can purchase condos with a pre-construction license accordingly, except for the entrance floor. 51% of these condos must be Thai property. The majority of property ownership in a building is prevented by law. The condo purchased by the foreigner does not grant ownership right in the land on the ground on which it is located, and if the foreigner does not have a foal or child, the foreign heirs have to sell the condo within 1 year. Otherwise, the Thai state sells it and puts the money in the bank to be paid when the foreign heir requests it. It is not possible for foreigners to acquire property by inheritance. The property acquired in marriage is shared equally among the spouses in divorce according to the Thai civil law, but if the spouse is a foreigner, the foreigner cannot demand the share of ownership in the divorce. Buying house during marriage is a "sin sua tuan"(personal property) of Thai wife. It is legally prevented from foreigners owning house/land through marriage.
- Thai authorities cannot give a deficit to the budget, they become personally responsible. (exception natural disaster, war, etc. expenses). The Thai state spends as much as the budget. There will be no budget deficit, no arbitrary spending disrupting budget discipline throughout the year. Foreign trade always gives surplus, and import taxes increase when necessary. Budget management is very good.
- The economic policy of the last 30 years, very low unemployment, very low interest rates and regulations that cease to be a tool for direct investment in public savings.
The USD rate is the same as before 10 years. Before Covid, there was no unemployment, many immigrant workers from Myanmar and Cambodia were working in unskilled jobs in Thailand to close the labor shortage. Inflation has been very low for the last 10 years. There is no foreign trade deficit.