Previously, VAT was not applied to goods costing less than 1,500 baht.

The Finance Ministry believes this change will create a level playing field in the local trading system, as imported goods will now be subject to VAT like locally purchased goods.

Import duties will still be determined by the Customs Department.

Initially, online purchases of low-cost goods below 1,500 baht will not be subject to Value-Added Tax (VAT) as they fall under the Customs Department's jurisdiction.

However, in the long term, the Finance Ministry will need to amend the Revenue Code under the Revenue Department to allow VAT collection on these goods.

Currently, VAT can only be collected on imported goods subject to import duties.

Since no customs duty is charged for imports worth less than 1,500 baht, they are also exempted from VAT.

The Finance Ministry aims to separate the two tax components to enable VAT collection from the first baht, ensuring fairness within the tax system.

The Thai government will implement a 7% Value-Added Tax (VAT) on online sales starting from the Customs Department.

Later, discussions will be held with online retailers to collect and remit the VAT directly to the Revenue Department.

This measure aims to boost local small businesses' competitiveness and control the influx of cheap Chinese products sold via e-commerce platforms like Lazada, Shopee, and TikTok Shop.