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Comprehensive analysis of Thailand’s new e-commerce tax compliance policies in 2024

Thailand’s new e-commerce tax compliance

In early 2024, the Thai Revenue Authority issued a series of new policies and requirements aimed at strengthening tax supervision and compliance requirements for e-commerce platforms. These policies have a significant impact on e-commerce sellers and the entire e-commerce industry. Below we will explain these new policies in detail, and discuss the impact on e-commerce practitioners and how to deal with related risks.

New policy overview

Tax registration and reporting requirements: According to the new policy of the Thai Taxation Bureau released in January 2024, all e-commerce platforms operating in Thailand must register with the Taxation Bureau and obtain a tax registration number. This means that all e-commerce platforms must declare their turnover, sales data, and related tax information to the tax bureau. These data include but are not limited to sales, value-added tax, income tax, etc. The platform needs to report these data to the tax bureau regularly and pay the corresponding taxes.

Import and sales regulations: The new policy also imposes stricter regulatory requirements on the import and sales behavior of e-commerce sellers. Sellers must comply with relevant import and sales tax regulations, ensure that import taxes are paid in compliance with regulations when importing goods from overseas, and that appropriate sales taxes are calculated and collected at the time of sale. In addition, e-commerce platforms also need to provide customers with clear price and tax details to ensure transparency.

Tax penalties: For e-commerce platforms that fail to comply with the new policies, the tax bureau will take severe penalties. These penalties include hefty fines, late fees for late payment of taxes, and even possible legal prosecution. In addition, if the platform fails to report sales data in a timely manner or falsely reports tax information, it will also face serious consequences.

Thailand’s new e-commerce tax compliance impact on e-commerce sellers

Increased pressure on financial management: The new policy requires e-commerce platforms to regularly report sales data and pay taxes, which may increase the pressure on financial management for some small e-commerce companies. They need to establish a more standardized and complete financial system to ensure timely and accurate recording and reporting of sales data and related tax information.

Rising compliance costs: In order to comply with the requirements of the new policy, e-commerce sellers may need to increase investment to improve financial and tax management systems, including purchasing financial software, recruiting professionals, etc., which will increase the operating costs of the enterprise.

Increased legal risks: If e-commerce sellers do not comply with the provisions of the new policy, they may face high fines and legal proceedings, which will seriously affect the company's operations and reputation. Especially for some small businesses, the inability to bear such legal risks may lead to bankruptcy or even closure.

Market competitive advantage weakens: Complying with tax compliance is not only a legal obligation, but also an important way to establish a good corporate image. Compliant companies are more likely to gain the trust and recognition of consumers, thereby occupying a more advantageous position in market competition. On the contrary, non-compliant companies may lose the trust of consumers and affect their market position and competitiveness.

How to address risk and handle compliance

Establish a professional team: E-commerce companies should establish a professional financial and tax team, including tax experts, accountants, etc., to ensure timely understanding and compliance with the latest tax regulations and requirements.

Strengthen internal controls: Enterprises should strengthen internal controls and audit mechanisms to ensure the accuracy and compliance of financial and tax data. This includes establishing a sound financial reporting system, internal audit procedures, etc.

Seek professional help: If the company lacks relevant professional knowledge and experience, it can seek help from professional tax consultants or lawyers to ensure compliance and reduce legal risks.

Wellion Wellion Commercial’s experience sharing

As an enterprise with rich experience in Thailand's e-commerce field, Wellion has been committed to establishing a compliant and transparent business system. By establishing a professional financial and tax team, we pay close attention to the latest tax policies and requirements and maintain good communication and cooperation with regulatory agencies to ensure corporate compliance. We also encourage other e-commerce companies to strengthen internal management and actively respond to tax compliance challenges to ensure the healthy development of the industry.

In Thailand’s e-commerce industry, tax compliance is key to long-term business development. Only by establishing a sound financial and tax management system and strengthening internal control can we effectively reduce tax risks and enhance the competitiveness and sustainable development capabilities of enterprises.

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