Government poised to cast tax net over online transactions
As the world continues its relentless move online, and away from traditional retail, governments are having to find new ways to track and tax online transactions.
The Thai Revenue Department is poised to cast a wider net over online vendors and other businesses that have been evading taxes. The National Legislative Assembly (NLA) is soon to approve amendments to the Revenue Code.
The amendment, which won 139 votes out of the 240-member NLA, will require banks and other financial institutions to report money transfers worth more than 2 million baht per recipient, per year, to tax authorities.
The Nation is reporting that the Deputy Finance Minister Wisut Srisuphan says the amendments will help the Revenue Department collect taxes for goods and services sold online, as sellers have been evading tax payment due to the use of electronic money transfers.
According to the proposed amendments, banks will have to report transfers totalling more than 400 transactions and worth over 2 million baht per year to the Revenue Department so authorities can investigate to see if these vendors paid taxes properly.
The Revenue Department had found it difficult to levy income and other taxes on e-commerce sites and online vendors due to a lack of information.
Most online vendors are individuals with no physical outlets, who sell their products via social and digital platforms. Buyers generally transfer money for the goods via banks’ electronic payment service, so authorities have found it difficult to follow up on tax collection.
According to the Revenue Department’s data, Thailand has 10.7 million citizens aged 30-39, of which 8.2 million are salaried workers, while the rest are self-employed. However, a large number of the self-employed do not pay taxes.
Thailand also has some 640,000 enterprises registered as ‘juristic persons’, of which only about 420,000 have filed tax returns.
But some NLA members are voicing opposition to the amendments, citing potential negative effects on other people, including NLA members, who themselves receive their meeting allowances via bank transfers.
Voraphol Sokatiyanuluk, an NLA member, said there were already other laws that empowered the Revenue Department to investigate tax evaders, so this amendment was unnecessary.
He added that the new requirements put additional burdens on financial institutions, as they will have to report transactions to the authorities.
ORIGINAL STORY: The Nation
