Podcast
Podcast
Podcast
Something went wrong
Questions and Answers
Questions and Answers
Thailand's existing tax laws are primarily designed for traditional businesses dealing with ______ goods and services.
Thailand's existing tax laws are primarily designed for traditional businesses dealing with ______ goods and services.
physical
Revising ______ rules could help ensure that profits are fairly allocated and taxed in Thailand.
Revising ______ rules could help ensure that profits are fairly allocated and taxed in Thailand.
transfer, pricing
South Korea's balanced tax approach reduces reliance on any ______ source.
South Korea's balanced tax approach reduces reliance on any ______ source.
single
Thailand's reliance on VAT may limit economic development by placing a higher relative tax burden on ______ individuals.
Thailand's reliance on VAT may limit economic development by placing a higher relative tax burden on ______ individuals.
Thailand's large informal economy leads to a narrower tax base, meaning there are fewer taxable activities and entities, leading to ______ tax revenue for the government.
Thailand's large informal economy leads to a narrower tax base, meaning there are fewer taxable activities and entities, leading to ______ tax revenue for the government.
High levels of public debt can lead to higher ______ costs for the government, as investors demand higher interest rates to compensate for the perceived risk.
High levels of public debt can lead to higher ______ costs for the government, as investors demand higher interest rates to compensate for the perceived risk.
An increasing ______ suggests that the fiscal health has not improved as claimed.
An increasing ______ suggests that the fiscal health has not improved as claimed.
Almost 70% of total tax expenditure in Thailand accrues to taxpayers in the ______ quintile, according to document data.
Almost 70% of total tax expenditure in Thailand accrues to taxpayers in the ______ quintile, according to document data.
80% of Thailand's personal income tax revenue is collected from ______ workers.
80% of Thailand's personal income tax revenue is collected from ______ workers.
Thailand's government expenditure
[as a percentage of GDP] averaged 17.5% from 2004 to 2013 and ______% from 2014 to 2023, showing a slight increase.
Thailand's government expenditure [as a percentage of GDP] averaged 17.5% from 2004 to 2013 and ______% from 2014 to 2023, showing a slight increase.
In 2021, VAT contributed ______% to Thailand's total government revenue, underscoring its importance in the country's fiscal policy.
In 2021, VAT contributed ______% to Thailand's total government revenue, underscoring its importance in the country's fiscal policy.
The sweetened ______ excise tax is implemented to reduce the consumption of high-sugar drinks.
The sweetened ______ excise tax is implemented to reduce the consumption of high-sugar drinks.
The economic substance test is a principle used to determine whether a transaction has a legitimate business purpose beyond merely obtaining ______ benefits.
The economic substance test is a principle used to determine whether a transaction has a legitimate business purpose beyond merely obtaining ______ benefits.
If the subsidiary exists only to lower taxes without engaging in any real business operations, it lacks a ______ business purpose.
If the subsidiary exists only to lower taxes without engaging in any real business operations, it lacks a ______ business purpose.
The 30% tax rate applied to income between 2,000,001 and 4,000,000 baht in the 2016 tax schedule, while in the 2017 tax schedule, the 30% tax rate now applies to income between 2,000,001 and ______ baht.
The 30% tax rate applied to income between 2,000,001 and 4,000,000 baht in the 2016 tax schedule, while in the 2017 tax schedule, the 30% tax rate now applies to income between 2,000,001 and ______ baht.
[Blank] is about using the tax code to your advantage to reduce your tax bill by taking advantage of deductions, credits, and other tax incentives that are legally available.
[Blank] is about using the tax code to your advantage to reduce your tax bill by taking advantage of deductions, credits, and other tax incentives that are legally available.
An ______ tax system minimizes economic distortions, promoting economic welfare.
An ______ tax system minimizes economic distortions, promoting economic welfare.
The 30% tax rate now applies to income between 2,000,001 and 5,000,000 baht, allowing for the potential of increasing the disposable ______.
The 30% tax rate now applies to income between 2,000,001 and 5,000,000 baht, allowing for the potential of increasing the disposable ______.
This helps in maintaining the equilibrium of a good, decreasing the ______ losses.
This helps in maintaining the equilibrium of a good, decreasing the ______ losses.
According to the Ramsey rule, minimizing ______ requires tax rates to be inversely related to elasticity of demand.
According to the Ramsey rule, minimizing ______ requires tax rates to be inversely related to elasticity of demand.
When consumers are not fully aware of a tax, they may not change their behavior as expected. This result is due to non-______ taxes.
When consumers are not fully aware of a tax, they may not change their behavior as expected. This result is due to non-______ taxes.
A change in government spending for a country, that is either increasing or decreasing, must be ______.
A change in government spending for a country, that is either increasing or decreasing, must be ______.
By taxing goods with inelastic demand at higher rates, the government can collect necessary ______ that is revenue.
By taxing goods with inelastic demand at higher rates, the government can collect necessary ______ that is revenue.
In summary, the DiD approach makes comparisons and analysis by ______ the differences in outcomes.
In summary, the DiD approach makes comparisons and analysis by ______ the differences in outcomes.
Under the 2017 tax schedule, the income above the set amount was to be taxed at ______%.
Under the 2017 tax schedule, the income above the set amount was to be taxed at ______%.
When implementing a tax for consumers, it is best to have strategic design that can influence the ______ of behavior.
When implementing a tax for consumers, it is best to have strategic design that can influence the ______ of behavior.
Revenue Adequacy, one of the major key principles, ensures that the tax system generates enough revenue to fund government services and obligations to ensure the ______ of market activity.
Revenue Adequacy, one of the major key principles, ensures that the tax system generates enough revenue to fund government services and obligations to ensure the ______ of market activity.
Anti-Avoidance measures are important for ensuring that tax strategies are in line with law's and economic ______.
Anti-Avoidance measures are important for ensuring that tax strategies are in line with law's and economic ______.
By understanding these dynamics, policymakers can better design and adjust the tax to achieve desired what: ______.
By understanding these dynamics, policymakers can better design and adjust the tax to achieve desired what: ______.
Income shifting strategies can help reduce tax liability depending on how well the ______ is strategized.
Income shifting strategies can help reduce tax liability depending on how well the ______ is strategized.
Income increases means the ______ will need to have some more to pay into the taxes.
Income increases means the ______ will need to have some more to pay into the taxes.
According to the data provided, sellers in the industry bear less costs.
According to the data provided, sellers in the industry bear less costs.
[Blank] refers to the legal obligation of who is responsible for remitting the tax to the government.
[Blank] refers to the legal obligation of who is responsible for remitting the tax to the government.
If more businesses do comply, then this should lead to more ______ compliance.
If more businesses do comply, then this should lead to more ______ compliance.
There are multiple key principles for tax policy for one economic setting for the nation. First, revenue must be ______.
There are multiple key principles for tax policy for one economic setting for the nation. First, revenue must be ______.
Questions and Answers
Something went wrong
Flashcards
Flashcards
Subsidiaries with Limited Roles
Subsidiaries with Limited Roles
Multinational digital firms establish subsidiaries in countries like Thailand for tasks like marketing, while keeping core operations in tax-favorable countries.
Impact on Taxable Income
Impact on Taxable Income
Because main profits of multinational digital firms are not reported in Thailand, the taxable income within the country is limited.
Engagement with Local Markets
Engagement with Local Markets
These firms interact with Thai customers and service providers; however, financial transactions are processed through the parent company located abroad.
Reduction in Tax Base
Reduction in Tax Base
Signup and view all the flashcards
Comprehensive Digital Tax Regulations Lack
Comprehensive Digital Tax Regulations Lack
Signup and view all the flashcards
Revenue Loss
Revenue Loss
Signup and view all the flashcards
Digital Services Tax
Digital Services Tax
Signup and view all the flashcards
Revising Transfer Pricing Rules
Revising Transfer Pricing Rules
Signup and view all the flashcards
Ineffective Tax Policy
Ineffective Tax Policy
Signup and view all the flashcards
Balanced Mix of Taxes
Balanced Mix of Taxes
Signup and view all the flashcards
Progressive Tax System
Progressive Tax System
Signup and view all the flashcards
Economic Development Impact (S. Korea)
Economic Development Impact (S. Korea)
Signup and view all the flashcards
Reliance on VAT
Reliance on VAT
Signup and view all the flashcards
Regressive Tax System
Regressive Tax System
Signup and view all the flashcards
Economic Development Impact (Thailand)
Economic Development Impact (Thailand)
Signup and view all the flashcards
Overall Implications
Overall Implications
Signup and view all the flashcards
Informal Economy
Informal Economy
Signup and view all the flashcards
Impact on Tax Base
Impact on Tax Base
Signup and view all the flashcards
Regulatory Frameworks
Regulatory Frameworks
Signup and view all the flashcards
Revenue Generation
Revenue Generation
Signup and view all the flashcards
Deficits and Borrowing
Deficits and Borrowing
Signup and view all the flashcards
Reliance on Indirect Taxes
Reliance on Indirect Taxes
Signup and view all the flashcards
Impact on Consumers
Impact on Consumers
Signup and view all the flashcards
Long-term Development
Long-term Development
Signup and view all the flashcards
Social Impact
Social Impact
Signup and view all the flashcards
Perception of Risk
Perception of Risk
Signup and view all the flashcards
Foreign Direct Investment (FDI)
Foreign Direct Investment (FDI)
Signup and view all the flashcards
Slower Growth
Slower Growth
Signup and view all the flashcards
Thai Fiscal Deficits
Thai Fiscal Deficits
Signup and view all the flashcards
Purpose of the Tax for high sugar
Purpose of the Tax for high sugar
Signup and view all the flashcards
Structure of the Tax high sugar content
Structure of the Tax high sugar content
Signup and view all the flashcards
Shifting Revenue
Shifting Revenue
Signup and view all the flashcards
What Is Tax Evasion
What Is Tax Evasion
Signup and view all the flashcards
Tax Evasion vs Avoidance
Tax Evasion vs Avoidance
Signup and view all the flashcards
Purpose of the Subsidiary illegal
Purpose of the Subsidiary illegal
Signup and view all the flashcards
Progressive tax
Progressive tax
Signup and view all the flashcards
Shifting and Splitting Incomes potential.
Shifting and Splitting Incomes potential.
Signup and view all the flashcards
Incentives for High Earners
Incentives for High Earners
Signup and view all the flashcards
Splitting Incomes strategy.
Splitting Incomes strategy.
Signup and view all the flashcards
Flashcards
Something went wrong
Study Notes
Study Notes
Thailand's Tax Policy: Multinational Digital Firms
- Subsidiaries of multinational digital firms in Thailand often handle marketing or support
- This limits the taxable income reported in Thailand
- Meaning Thailand cannot fully tax these firms' activities, leading to revenue loss
- These firms interact by offering services, but payments are processed abroad
- Revenue doesn't flow through the Thai subsidiary
- Reducing the taxable income Thailand can claim
- Existing tax laws are designed for traditional businesses with physical presence
- Lacking rules for digital businesses causes revenue loss
- A digital services tax could target revenue from digital services within Thailand
- Revising transfer pricing rules could ensure fair profit allocation and taxation
- Current tax policy is not fully effective because of firm structure and regulation
- Reforms are necessary for fair taxation, contributing to the Thai economy
- This challenge is global due to difficulties in taxing digital firms effectively
Tax Structures: South Korea vs. Thailand (1990-2019)
- South Korea uses a combination of income, consumption, and other taxes
- Creates balance and avoids reliance on a single tax source
- South Korea: Income taxes indicate a progressive system with wealth redistribution
- By funding social programs, equitable economic growth is supported
- This ensures all segments of society benefit from economic progress
- Thailand relies heavily on Value Added Tax (VAT), a consumption tax at all stages
- VAT is regressive, taking a larger percentage from lower-income individuals
- It affects all regardless of income level, disproportionately impacting lower earners
- The reliance on VAT may limit economic development by increasing inequality
- It limits consumer spending, as lower-income individuals have less income
- South Korea's structure supports equitable growth and a stable economy
- Thailand's VAT reliance may hinder inclusive development due to inequality
Thailand's Informal Economy: Tax Implications
- Informal economy refers to unregulated and unreported economic activities
- This includes street vendors, small-scale artisans, and unregistered businesses
- The Thai formal tax system does not account for these activities
- Resulting in a narrower tax base and reduced revenue generation for the government
- Regulatory Frameworks: Informal businesses operate outside regulatory frameworks
- Tax Collection: Lack of records and registration limits tax colleciton
- Reduced tax base limits the governments ability to fund healthcare and education
- Lack of revenue can lead to deficits, forcing the country to borrow
- Reliance on Indirect Taxes: Might rely on VAT to compensate which is regressive
- Taxes can disproportionately negatively affect low-income individuals
- Limits govenments effective of collecting needed adequate revenue
Thailand: Public Debt Impact (Exceeding 70% of GDP by 2028)
- The government may need to raise taxes to generate revenue for debt servicing
- This could involve increasing existing taxes or introducing new taxes
- Higher taxes reduce disposable income, slowing down economic growth
- Government might reduce spending on public services and infrastructure projects
- Reduced investment hinders long-term economic development and quality of life
- Austerity measures could include cutting subsidies or limiting welfare programs
- Social Impact: Austerity measures disproportionately affect lower-income groups
- High debt levels can make investors wary and increase governmnet borrowing costs
- FDI can be impacted as foreign investor may not want to invest in a country with high debt levles
- Reduced government spending and decreased confidence can slow economic growth
- If economic slows harder to generate revenue needed to serive debt
Thailand's Fiscal Deficits (2014-2023)
- Thailand's fiscal deficits have increased, reaching as high as -4.6% of GDP.
- The data contradicts the statement, showing an increase in fiscal deficits
Tax Expenditure in Thailand (Distribution)
- Almost 70% of total tax expenditure benefits the top quintile, not bottom
- Tax benefits are skewed towards wealthiest segment of the population
Income Tax Revenue in Thailand: Source
- The majority of Thailand's personal income tax comes salaried workers
- Most of tax revenue is collected from salaried workers, not non-salaried
Government Expenditure Thailand: 2004-2023
- Thailand's government expenditure increased as a percentage of GDP
- Government expenditure averaged 17.5% from 2004-2013 and 17.7% from 2014-2023
Thailand's Revenue & Similar Countries
- Thailand's tax revenue was 16.1% of GDP in 2019
- Tax revenue for upper middle income countries was 18.4% of GDP
- Implying a lower tax burden or less efficient tax collection
Principles for an Effective Tax System:
- Generates enough revenue to fund government services and obligations
- Minimizes economic distortions, avoiding discouragement of work or investment
- Equitability in taxation: Horizontal Equity: Taxpayers with similar situations that pay similar taxes.
- Equity in taxation: Vertical Equity: Taxpayers with higher incomes should higher taxes.
- Simplicity: Easy for taxpayers to understand, reducing compliance costs.
Government Revenue:
- Governmnet Revenue averaged 17.2% from 2004-2013
- Average dropped in the later period to 15.6% suggesting decreases in revenue collection
- Could potential affect government funding for programs
Value Added Tax (VAT) In Thailand: 2021
- Accounts for 31% of Thailand's revenue and over one-thired of country's total incom
- Indirect tax applied at each stage is ultimately born by end conumer. The reliance can ffect consumer prices and spending
Tax Planning: Thai Sweetened Beverages
- Aims to reduce sugar consumption by raising prices on high-sugar drinks
- Increases over time, taxing high-sugar content drinks more heavily
- Gradual increases will result in decreased demand
- Promoting Healthier consumption habits
Taxes: Avoidance vs. Evasion
- Tax Avoidance legally use the tax regime for advantage.
- Tax Evasion involves deceit, subterfuge, to conceal information to reduce liability. Legal Consequences: Severe
Tax Avoidance/Evasion Case Analysis:
- Contributing to a Retirement Mutual Fund (RMF): Tax Avoidance
- Misrepresenting tuition payments as donations: Tax Evason
- Shifting revenue to a different tax period: Follows guidelines therefore Avoidance
- Issuing receipts under different names: Tax Evasion.
Economic Substance Test: Tax Strategy Analysis
- A test used to determine whther the transaction has legitimate business purpose beyond obtaining tax benefits
- Substantial business purpose and not just reduce taxes
- The transaction should reflect genuine activities, and not just be a paper one. Failing this test increases company tax liabilities and regulatory legal risks
South Korea Income & Economic Activity
- As income inreases taxes are progressively increasingly higher
- Shifts income more effectively
- The strategy contributes and shifts the equity wealth
Personal Income Tax in Thailand
- Brackets for each specific rate vary.
- Tax Brackets increase as an individual has more income.
- Deferring Income or splitting Income Regulatory Compliance- non-compliance equals tax evasion Future Tax Rates- can change when incme has been set already therefore resulting in even higher taxes
Changes in Tax Treatment (2016 vs. 2017)
- The range for tax rates was between 2,000,001-4,000,00 baht in 2016
- In 2017 Tax Schedules it was between 2,000,001-5,000,000 baht
- Key Change: Higher threshold for the 30% tax rate.
Tax Avoidance
- Legal & used to minimize taxes Tax Evasion
- Illegeal and used with falisifying information
Impact on Income: Thailand Sweeten Bevs
- Price increases/decreases for what consumer is willing to pay to the quantiity the demander/willing to accept
Consider Three Types of Incomes
1 Shift income from one type ot anotehr
- Convert to capital gains which have lower rates Shift if income increases but still must have a strategy
Three Incidences of Tax: Supply, Supply, Elastic
Three incidence
Distributing a Tax
- Consumers more elastic less quantity
- Producer will not have as bad
Analayzing the Impacting the Gov: a high inelastic is a good economy because minimum impact with quantitiy but high impact with economic development
The statuatory Incidence of tax
- Legal obligation -Relative and Elasticity
- Consumers bare burden because not responsive
The effectiveness
- is dependent because effective, and generates minimum
Anaylze: what does effect: it is less if they dont, and consumers less is more what is needed to be done
What tax does on carbo exissions
More expensve , the more you save on alternative and revent
Explain tax a good: if an individual is highly related or not
Discuss data that are in quintiles with thai
Those data means not all people can afford the ltf
Economic in thaialnd: what this could lead
If you work harder and get an extra income could benefit that to help If the money is just taxed less will It all must balance better and well
Tax on alchol:
Not much change
Marginal Value: of what your work is about
If a lot to do then tax will be higher; however, if not as minmal
How Taxes Effcets
- If people work less
- They will be more likely to ask to do less
- What to measure before is important
Look at Taik in Thai
More is work done more pay out Income changes, changes lesuire to take pay
- The amont of how much that has been done the more or less the work can affect
Hag Definition
- Should reflect all changes for something to be as accurate as possible
Look for tax benefit:
To get as a taxpayer and government
- For everything you do with tax
Equity
- Equity is the idea that when you dont pay to the equal
Thailand
- Is the primary to tax what it is for other
- If your not you dont really pay
In Thailand for Personal taxes
- Most is salary as it is the primary one and people cannot get around
1 Analyze Thailand
- There would need to more changes and this does effect people
- Need to check how it affects their savings
More
- This is important to know and is true
- Does a lot for the tax
- The rule does a guideline to do taxes
Thai Government
- Makes policy to pay less
Thai Taxes: more more
But people cannot avoid
To analyze this all: what do all three types
- Need to see who, why, and what type They cant do it right if they dont go through all
To analyze all of three:
who, what and why They cant avoid if they dont have it all
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Study Notes
Something went wrong
