Relieving news for Foreign Professionals in Thailand – they are eligible for a tax waiver on their income. Foreign professionals will receive 17% Personal Income Tax relaxation this fiscal year. Owing to the highly uncertain and stressful tenure of COVID-19 lockdown, human life across the world came to a standstill. Moreover, similar stagnant was the source of income and revenues, casting adverse effects on the economy.
The Royal Thai Government again expressed its benevolence to Foreigners in Thailand. The honorable Director-general of the Revenue Department, Mr. Ekniti Nitithanprapas made a great announcement. It is about cutting the personal income tax rate for foreign professionals to 17%. Although not directly stated, yet, the announcement seems to entice highly trained people to work in Thailand.
Current Scenario and the Announcement
Thailand’s personal income tax is progressive, with rates varying according to wage level. Those with yearly incomes between 150,001 and 300,000 baht are taxed at a rate of 5%. Whereas, those with annual incomes over 5 million have to pay taxes at a rate of 35%.
According to Mr. Ekniti, foreign professionals in Thailand who qualify for the lower tax rate must work in fields with scarcity. These professionals could work in any part of Thailand.
He stated that the department is considering a time limit for this tax benefit. Therefore, this tax relaxation scheme is having a validity period and you must act fast to apply for your audit and tax filings.
The government authorization on measures aims to entice “high-potential” foreigners to stay in Thailand for an extra period of time. The National Economic and Social Development Council has been tasked by the cabinet to confer with relevant state institutions, including the Finance Ministry, on the topic.
Perception of Director-General of Thailand Revenue Department
According to Mr. Ekniti, a tax decrease would not be the primary attraction for international talent to work in Thailand. However, other aspects such as the country’s safety and high-quality schools and medical care would be more important. Because of these factors, some governments believe lower tax rates are unneeded and repeal them after enacting such legislation.
To entice foreign specialists to work in Thailand, the cabinet also approved a five-year reduction in import duties for select commodities, such as wines, alcoholic beverages, and cigars. The current duty rate for these commodities is between 30 and 60%.
The Customs Department concluded its analysis of the details of this duty reduction measure, according to Patchara Anuntasilpa, director-general, and would recommend it to the Finance Ministry for consideration.
He believes that lowering duties will not entice more foreign talent to work in Thailand because they make a good wage and can easily purchase these things. Mr. Patchara stated that the department is still willing to reduce the obligations if the ministry believes it will work.
Since then, the Cabinet has authorized steps to entice highly skilled immigrants to stay in the nation on a long-term basis. According to Bangkok Post, the National Economic and Social Development Council has been tasked with consulting with relevant state departments, including the Finance Ministry.
The Bottomline
The entire announcement is good news for Foreign Professionals in Thailand who are tax residents of the nations as well. This gift from the Thai Revenue Department can help you save a few bucks from your hard-earned money. But you must keep yourself updated with the latest news from the Department. Mr. Ekniti very prominently states that the facility won’t be forever and is for a limited span of time.
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