Certain types of businesses are subject to Specific Business Tax (SBT) rather than Value Added Tax (VAT). Businesses subject to SBT must pay VAT on their purchases of goods and services but are not entitled to a VAT credit. The SBT ranges from 2.5 – 3.0 per cent on monthly gross receipts. When a monthly return is filed and SBT is paid, an
additional amount of 10% of the SBT payable is levied as a municipal tax.

Businesses that are subject to SBT

  • Banking, financial and similar business
  • Life Insurance
  • Pawn Brokerage
  • Real Estate
  • Any other business specified by the Royal Decree i.e. business engages in repurchasing agreement (REPO) and factoring

Activities of certain entities are exempted from SBT such as:

  • Activities of Bank of Thailand, Government Savings Bank, Government Housing Bank and Bank for Agriculture and Agricultural Cooperatives
  • Activities of the Export-Import Bank of Thailand, the Industrial Finance Corporation of Thailand, Asset Management Corporation, Small Industrial Finance Cooperation and Secondary Mortgage Corporation
  • Activities of National Housing Authority, Government Pawn Brokerage and Pension Fund
  • Activities of selling securities listed in the Stock Exchange of Thailand

Specific Business Tax Base and Rates

Business

Tax Base

Tax Rate

Banking, Finance and similar businessInterest, discounts, service fees, other fees, profits from foreign exchange

3.0

Life InsuranceInterest, service fees and other fees

2.5

Pawn BrokerageInterest, fees, remuneration from selling overdue property

2.5

Real estateGross receipts

3.0

Repurchase AgreementThe difference between selling price and repurchasing price

3.0

FactoringInterest, discounts, service fees and other fees

3.0

Filing Specific Business Tax Return and Payment

SBT taxable period is a calendar month. SBT return (Form SBT 40) must be filed (and payment must be submitted) on a monthly basis by the 15th of the following month
whether or not the business has income.

Contact MSNA for your accounting and tax questions.