Cabinet Extends 7% VAT Rate for Another Year
Thailand's Cabinet approved extending the 7% VAT rate for another year through September 2026, aiming to ease living costs and boost consumer spending and business investment.
The Cabinet has approved in principle an extension of the value-added tax (VAT) reduction measure for an additional year, maintaining the VAT rate at 7% from October 1, 2025, to September 30, 2026, to ease the burden of living costs, stimulate consumer spending, boost business confidence, and support private sector investment aligned with the country's economic goals.
Government spokeswoman Ratchada Thanadirek revealed that the Cabinet meeting approved the draft royal decree under the Revenue Code regarding the VAT rate reduction, as proposed by the Ministry of Finance, to extend the VAT reduction measure for one more year.
Ratchada stated that the core of the measure is to extend the period of the VAT rate reduction, which was set to expire on September 30, 2025, for another year starting October 1, 2025, through September 30, 2026. The VAT rate will remain at 6.3 percent (excluding local taxes) or 7 percent (including local taxes) on a temporary basis for all sales of goods, services, and imports.
"Maintaining the VAT rate at 7 percent will help reduce the impact of rising living costs and stimulate consumer spending, which will strengthen business confidence in the Thai economy and allow private sector investment within the country to expand according to targets. It will also help create a favorable business environment for the private sector," Ratchada said.
