On 03 Feb 2021, Thailand's Director-General of Revenue issued a Notification on VAT (No 238) expanding the type of suppliers entitled to exemption from VAT for the provision of research services.

This Tax Insight has been updated for this Director-General's Notification.

The Thailand VAT Law

Section 81(1) of the Thai VAT law prescribes goods and services transactions that are exempt from VAT, and Sub-Section 81 (1) (k) prescribes the following services transactions are exempt from VAT:

• Provision of research services of the types and by suppliers as specified by the Director-General of Revenue with the approval of the Minister.
  

The Director-General's Specifications

The Director-General's specifications for entitlement to the exemption from VAT under the above law are as follows:

1. The research services shall be:

• Scientific research; or
• Social research;

2. The research services shall not be:

• Provided as commercial profit-seeking services;
  
• Except for government agencies having the status of ministry, department or government enterprise, or a business of the government, or a business unit of the government.

3. The supplier providing the research services shall be:

• An individual or non-juristic body of persons;
• A foundation;
• A higher educational institution (including either a government or private higher educational institution);
• A government special service unit that does not have separate legal entity status*; or
• A government agency for research and innovation thats not-for-profit and thats not a state enterprise**.

* As amended by Director-General's Notification on VAT (No 228) dated 15 Aug 2019.
** As amended by Director-General's Notification on VAT (No 238) dated 03 Feb 2021.

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