Minister clarifies digital services accord

The Agreement on Reciprocal Trade between the US and Thailand regarding the exemption of import duties on digital services concerns the downloading of cross-border digital goods, not the provision of cross-border services or e-service tax, says Finance Minister Ekniti Nitithanprapas.

- WICHIT CHANTANUSORNSIRI

The minister said both sides have reached a mutual understanding that the digital services tax is not the same as the e-service tax currently collected by the Revenue Department on cross-border service providers operating in Thailand, which are subject to a 7% value-added tax.

Under the US-Thailand agreement, Thailand agrees to exempt import duties on American digital services in exchange for the US setting its import tariff rate at 19%.

Mr Ekniti said the digital services tax pertains to the downloading of digital goods like music, which in the past was listened to on CDs but is now downloaded through streaming services and is not considered to be downloading via a platform.