Personal Income Tax
On 12 February 2016 the Thai government announced that the reduction in the progressive personal income tax (PIT) rates has been extended to the 2016 tax year with the issuance of Royal Decree No. 600.
Accordingly, for the 2016 tax year (as was the case for the 2013 – 2015 tax years) the temporary reduction in the PIT rates will be 0 percent to 35 percent with seven income tax brackets.
While this is merely an extension in the reduced PIT rates for another year, had the Royal Decree not been approved, the PIT rates would have reverted to the pre-2013 tax scale, with old rates ranging from 0 percent to 37 percent. Therefore, individual taxpayers carry a lesser tax burden for another year and there should be no increase in the cost of international assignment programs for expatriates.
|Net taxable income (THB)||Tax rate (%)|
|0 - 300,000*||5|
|300,001 - 500,000||10|
|500,001 - 750,000||15|
|750,001 - 1,000,000||20|
|1,000,001 - 2,000,000||25|
|2,000,001 - 4,000,000||30|
|4,000,001 and Over||35|
* The tax exemption for annual wage income below 150,000 baht remains in place as it is covered in Royal Decree No. 470 dated 28 March 2008 (still in force); this effectively adds a 0 percent rate on wages below THB 150,000.
The extension will be effective for the tax year 1 January 2016 – 31 December 2016.
Some observers believe that the Thai government still needs to consider further reducing personal income tax rates to enhance the country’s competitive advantage in relation to neighboring ASEAN countries.
© 2018 KPMG Phoomchai Tax Ltd., a Thailand limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
KPMG International Cooperative (“KPMG International”) is a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.