Thailand Keeps VAT at 7% Through September 2027, Holding Off the Return to 10%

Thailand’s Cabinet approved, in principle, a further one-year extension of the country’s reduced value-added tax rate at its meeting on July 27, 2026. Under the draft decree put forward by the Finance Ministry, VAT stays at 6.3% (7% once the 1% local tax is added) for the period from October 1, 2026 to September 30, 2027, rather than returning to the standard 10% rate set in Thai law.

This is not a new policy direction so much as the latest in a long-running pattern: Thailand has kept VAT at the reduced rate through repeated annual extensions since 1999, and the Finance Ministry’s stated reasoning this time was the same as in previous years — avoiding extra pressure on household costs and consumer spending while the economy recovers. The Ministry said the extension would not affect its fiscal 2027 revenue projections, since those were already calculated using the 7% rate.

The extension sits awkwardly next to the government’s own medium-term fiscal framework for 2027–2030, which calls for VAT to rise to 8.5% in fiscal 2028 and to the full 10% in fiscal 2030. Prime Minister Anutin Charnvirakul has said the rate “will definitely not increase” for as long as he is involved in government, leaving the framework’s later targets as an open question rather than a settled plan. For anyone budgeting for purchases, services or imports in Thailand over the coming year, the practical takeaway is that the 7% rate that has applied for years continues unchanged through September 2027.