Business operating in Thailand and exceeding 1.8M THB in turnover are subject to paying VAT (value added tax), or in other words, an indirect tax imposed on the value added at each stage of production and distribution.
However, the nature of some businesses, such as financial institutions and services, does not allow for clear distinction between production costs and the value added, which resulted in the introduction of Specific Business Tax (SBT). SBT is a parallel tax to VAT and its origins likewise date back to 1992.
As previously mentioned, some of the business liable to pay SBT instead of VAT operate in finances, namely banks, financial institutions, insurance and loan companies and others. Other qualifying entities that fall into this category must bear a resemblance to the above-listed businesses in terms of transaction type; are real estate companies and businesses concerning sale of securities. The law, however, allows for exemptions and the full list of SBT exempted types of businesses can be found