The Thailand government is looking into tightening tax imposed on technology and internet related companies such as Google.
According to a report, the Finance Ministry and the Revenue Department of Thailand plans to roll out the new technology and internet tax before 2017. Officials are currently researching about possible perimeters to put in place to toughen tax collection rules. The director-general of the Revenue Department, Mr Prasong Poontaneat released the statement in a recent talk with Reuters.
He declared that Thailand is currently focusing on changing the regulations to keep up with the growing tax affairs in Southeast Asia. The government has already formed a committee that is working on the matter. The committee has been active for two months now.
“We are studying this issue and have set up a committee to look into this over the past two months,” Prasong said. “The idea is to seek appropriate solutions for Thailand and it could involve an amendment in some regulations because current laws are outdated and have been used for more than 50 years” he added.
This tax tightening plan for technology comes after the consecutive issues faced by other Southeast Asian countries such as Indonesia and Singapore.
Just recently, the Indonesian government launched an investigation into Google after it allegedly evaded five years of taxes worth billions of dollars it made from ad revenues. The tax office is purportedly pursuing Google for the unpaid tax which may cost as much as $400 million USD for the year 2015 alone.
Meanwhile, Singapore, a major tech hub, has released in an e-mail last month that “profits should be taxed where activities giving rise to the profits are performed and where value is created” and that it does not excuse the “artificial shifting of profits”.
These tax crackdowns has been cited by American investors as a risk as it may scare away potential multinational companies that would want to invest in Southeast Asia. Despite this, Indonesia, Singapore, and now Thailand are pushing through with their plans.