Shops reject Thailand’s co-pay system fearing back taxes

Several restaurants and shops put up signs saying they would not accept payment through the government’s 50:50 co-payment stimulus program because they feared tax officials would seek tax refunds.

Rangsiphan Poonphan, a market trader behind the Ministry of Finance, told Thai PBS she was worried she might have to pay more taxes, after learning that several shops had started refusing payments under the tax scheme. co-payment, although she admitted the scheme boosted her sales.

Some stores in Pracha Chuen and Phahonyothin areas claimed that the tax authorities had demanded back taxes from them, amounting to tens of thousands of baht.

The Office of Tax Policy, however, insisted that the co-payment system is not linked to the Revenue Department database and that tax refunds should not be a problem.

According to the office, small entrepreneurs who have joined the program can submit their tax return forms as an individual taxpayer.

Businesses with annual revenues exceeding 1.8 million baht will need to register for Value Added Tax (VAT). Failure to do so means they risk a 2,000 baht fine and pay 1.5 times the assessed amount.

More than 1.3 million stores and sellers have joined the 4th phase of the co-payment system.

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