He proposed a revision to the existing tax laws to encompass not only businesses operating within Thailand’s borders, but also over-the-top (OTT) service operators based overseas that generate revenue through the provision of their services in Thailand. An over-the-top (OTT) media service is a specialized terminology referring to any online content provider that delivers streaming media as an independent product.
On a House of Representatives meeting convened on a Saturday, Takorn put forward his observation that millions of Thai people are now turning to their smartphones for shopping and availing other online services. He ventured further into the detailed mechanics of these transactions, stating that they lean on the OTT system as a means to transfer money. A unique feature of these transactions, as he explained, is that the money is initially transferred outside Thai boundaries and then funnelled back into the country. He suggested that such transactions should attract a service fee ranging anywhere between 15 to 20%.
“Thailand ends up disbursing this amount to foreign service providers. Presently, the country levies value-added tax on the revenue accumulated through global platforms like YouTube and Facebook. However, the responsibility of bearing this tax falls on the Thai taxpayer. For foreign service providers offering OTT services, there is no existing tax provision,” articulated Takorn, who also acts as the secretary-general of the Thai Sang Thai Party.
Takorn’s remarks came to light during a House deliberation on an emergency decree focusing on information exchange relating to the execution of international agreements on tax and tariffs, a proposal initiated by the Cabinet. As a former secretary-general of the National Broadcasting and Telecommunications Commission (NBTC), Takorn put forth the idea that the tax law should be inclusive of foreign OTT operators who profit from their services rendered in Thailand. “By adopting this approach, Thailand can prevent the outflow of its tax revenue to other countries,” he commented.
Subsequent to Takorn’s dialogue, Acting Finance Minister Arkhom Termpittayapaisith directed the Revenue Department to present an explanation on the matter to the House of Representatives in a written format. When taken to a vote, the House of Representatives displayed their support for the suggested legislation with a distinctive vote of 427:1, with five abstentions, in the first reading.
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