Bangkok: The Cabinet has approved extending the VAT rate to 7% for another year, until September 2027, aiming to stabilize the cost of living and maintain economic stability.
According to Thai News Agency, the Cabinet meeting led to the approval of the principles of the draft Royal Decree under the Revenue Code concerning the reduction of the Value Added Tax (VAT) rate. This proposal, put forward by the Ministry of Finance, aims to extend the VAT reduction measure for another year.
Ms. Rachada Thanadirek, Spokesperson for the Prime Minister's Office, announced that the VAT rate, originally set to expire on September 30, 2026, will now be extended from October 1, 2026, to September 30, 2027. The VAT rate will remain temporarily at 6.3% (excluding local taxes) or 7% (including local taxes) for all sales of goods, services, and imports.
Ms. Rachada emphasized that maintaining the VAT rate at 7 percent is intended to mitigate the rising cost of living, stimulate public consumption, and boost business confidence in the Thai economy. This measure is also expected to encourage domestic private investment and create a more favorable business environment for the private sector.