SMEs urged to adopt digital tax to minimise transaction costs

With the Revenue Department set to implement a fully digitized taxation system by 2028, the Thai Chamber of Commerce organised a seminar August 21 to explain the benefits of the system and well as the benefits SMEs would enjoy.

In his keynote speech, Thai Chamber of Commerce chairman Sanan Angubolkul urged TCC members and SMEs to take part in the e-tax system in order to accelerate growth.

Lavaron Sangsnit, director-general of the Revenue Department, spoke of the SME eco-system, saying that the department is in the process of transforming its tax collection system to digital tax invoicing which would benefit SMEs and reduce transaction costs.

The department, which is now converting into a data-driven organisation, has built a central data lake system to gather taxpayer data and create taxpayer profiles. This allows all regional offices to access and use identical information to generate efficient results for taxpayers.

A range of technologies and software are being adopted to help taxpayers and the Revenue Department, such as software that can track online trade and transactions, which will structure an unstructured tax system, and the AI chatbot Chatgpt, which will provide taxpayers with accurate taxation laws and regulations, as well as case studies, Lavaron said.

He stressed that these vital technologies will transition the tax system to a fully digital tax system, helping SMEs avoid unexpected tax punishments, assisting officers in resolving issues in an efficient way, reducing disputes, lowering transaction costs and accelerating tax refund returns.

Some challenges still remain, including making the revenue platform more user-friendly and lowering transaction costs for SMEs.

Lavaron also urged SMEs to use e-tax service providers, of which there are currently around 20 listed on the revenue department website.

During the panel discussion, both Somsak Anuntawat, deputy director-general of Revenue, and Chancharoen Thepsutha, director of the Revenue Department's Electronic Tax Administration Division, emphasised that the Revenue Department prefers tax service providers like law firms and banks to make the switch to e-tax service providers to speed up the transition to digital taxation or e-tax invoice system

According to Somsak, the e-tax invoice can connect data with other government and private stakeholders such as the Bank of Thailand and the Ministry of Commerce's Department of Business Development.

Besides, digital taxation will grant SMEs with a registered capital of less than 5 million baht and an annual income of less than 30 million baht with a double tax exemption on software and hardware investments.

Chancharoen added that digital taxes reduce transaction costs while improving international competitiveness. The digital taxation system in the US and New Zealand had been shown to decrease transaction costs by up to 70%, she noted.

The Revenue Department expects to collect tax revenue of 150–200 billion baht this year.