Cabinet approves extension of 7% VAT rate until 30 September 2026

Cabinet approves extension of 7% VAT rate until 30 September 2026.

On 9 September 2025 the Thai cabinet approved in principle a draft royal decree to be issued under the Revenue Code to extend Thailand’s 7% VAT rate for another year to September 30, 2026.

The new royal decree is required because the 7% VAT rate is set to expire on 30 September 2025. The 7% rate applies to the sale of goods, the provision of services and imports.

The minutes of the Cabinet meeting stated that the decision to continue with the 7% VAT rate was due to the limitations and risk factors facing the country’s economy from increased household and business debt, coupled with low unemployment and inflation rates, declining interest rates, the impact of US import tariffs, and the volatility of the global economic and trade system. Therefore, extending the VAT rate reduction will reduce the impact on the cost of living, stimulate public consumption, and ultimately boost business confidence in the Thai economy and allow private investment within the country to expand as targeted.