Facebook collects 7% VAT from shooting Ads, starting in September 2021. Who is affected?

From the case that Facebook announced clearly that it will start collecting 7% value added tax (VAT) from shooting ads. It will start simultaneously all over Thailand on September 1, 2021, causing quite a bit of shock to users of the Facebook platform, especially online traders.


Because it’s equal to that, in addition to having to pay for Ads shooting, you also have to pay 7% VAT added. So what inspired Facebook to collect VAT?

In fact, Facebook’s VAT collection comes from the Thai e-Service law, which stipulates that foreign online platform operators Services provided in Thailand are subject to VAT to the Revenue Department. It became effective on September 1, 2021. The reason for the e-Service tax collection is to create fairness for Thai entrepreneurs. Because in the past, Thai entrepreneurs who provide electronic services Must be registered as a VAT entrepreneur, have to file a VAT form and always pay VAT. While foreign entrepreneurs who come to provide services in Thailand do not have to file tax returns. because the original law did not cover foreign groups

VAT collection of foreign digital platform providers There will be clear rules specifying that besides Facebook, what kind of platform providers are eligible for e-Service tax and who will the conclusion of Facebook’s VAT collection this time be? How do online traders have to adapt or cope with this? Sanook Money had the opportunity to talk to Asst. Siam University to unlock all doubts in this matter

Foreign platforms that are eligible for e-Service tax payment

Asst. Prof. Dr. Yuttana said that the e-Service tax is collected from foreign digital platforms providing services in Thailand. The income from such services exceeds 1.8 million baht per year by providing online services in the following formats:

Online selling platform (E-Commerce)
Advertising platforms like Facebook or Google
Online service platform for booking accommodation – hotels, travel tickets such as Booking.com, Agoda
An intermediary platform such as calling a shuttle, ordering food
Online service platforms such as games, watching movies, listening to music, cloud systems, online meetings, subscription and other digital content such as App Store, Play Store, PlayStation Store, Netflix, Youtube, Spotify, Zoom or Dropbox.
Which service providers fall into the category of paying e-Service tax must register for VAT with the Revenue Department through the VES (VAT for Electronic Service) system, which the Revenue Department has updated the list of registered foreign digital platforms. Recently, there are 61 VAT registered with the Revenue Department (as of August 31, 2021), with other foreign digital platforms expected. A total of 100 registrations were registered as entrepreneurs in Thailand.

Facebook collects 7% VAT. Who will this event affect?

Asst. Prof. Dr. Yuttana thinks that it almost does not affect online sellers on Facebook at all because the e-Service tax is a VAT collected only on foreign digital platforms. If asked how Thai traders and entrepreneurs who use Facebook will adapt, they would like to divide them into 2 groups as follows.

Ordinary people online who do not register for VAT. If you shoot Ads, you will have to pay for ads and VAT 7% according to Facebook’s policy. But if you don’t buy Ads, you won’t be affected.

As for entrepreneurs who register for VAT I almost didn’t have to adjust much. Just inform the taxpayer ID number to Facebook for acknowledgment and submit a Phor.Por.36 form to be sent to the Revenue Department as usual.

If users refuse to pay VAT to Facebook, what will happen? The simple answer is that merchants who do not register for VAT may be suspended from using the service according to Facebook’s regulations. and company policy For traders who register for VAT, if they do not file a P.P. 36 form, send it to the Revenue Department. Will be subject to a fine of not more than 2,000 baht per time, additional money or interest of 1.5 percent per month (fractions of a month are counted as 1 month)

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