MONDAY, April 15, 2024
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Thai draft ready for levying 15% global minimum tax on large multinationals

Thai draft ready for levying 15% global minimum tax on large multinationals

The Revenue Department will propose to the Cabinet a draft act within the first half of 2024 on imposing global minimum tax (GMT) at 15% on large multinational enterprises.

The department’s director-general, Kulaya Tantitemit, said on Friday that the draft has been prepared under the agreement with the Organisation for Economic Cooperation and Development (OECD), an intergovernmental organisation of 38 countries, to promote transparency and fairness in tax collection.

Currently more than 140 countries have signed up for the GMT deal. The tax treaty seeks to end the practice of multinational companies shifting profits to low-tax countries and territories, even though the income was generated elsewhere.

Under the GMT agreement, if a country levies a tax rate below 15% other countries will be able to impose a top-up tax that brings the total up to the minimum level.

The scope of the GMT act will include multinational corporations with total revenue over 750 million euros (29.18 billion baht) per year and over, said Kulaya.

After the draft receives a green light from the Cabinet, the Revenue Department will start public hearings, in which citizens and stakeholders will be invited to submit their opinions through the department’s website.

The department will also organise a campaign to educate the public about the principles and details of the GMT, as well as evaluate the impact on Thailland’s economy after it is enacted in the kingdom.

The Revenue Department reported tax collection of 2.21 trillion baht in fiscal 2023. Most of the revenue came from value-added tax at 912.58 billion baht, while corporate and personal income taxes contributed 767.32 and 395.75 billion baht, respectively.

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