VAT Rates on Digital Services in Mauritius and Thailand

Digital services (telecommunication, broadcasting and electronic services) are subject to different VAT rules. The Organisation for Economic Co-Operation and Development (OECD) states that: “For consumption purposes internationally traded services and intangibles should be taxed according to the rules of the jurisdiction of consumption.”

Numerous tax jurisdictions are taking their lead from the OECD recommended approaches to taxing the digital economy. The latest countries to offer guidance are Mauritius and Thailand.

Mauritius

The Republic of Mauritius announced its budget for 2020-2021 in early June 2020.

It was mentioned that VAT would be introduced on digital and electronic services provided by non-residents.

The current VAT rate in Mauritius is 15%.

Thailand

On 9 June 2020, Thailand approved a draft bill that will require VAT to be paid on foreign digital and electronic services provided in Thailand.

A 7% VAT will be applied to sales relating to non-resident companies that earn over 1.8 million baht per year from providing digital services in the country.

This new VAT rate will apply to services including:

• Video streaming
• Music streaming
• Gaming
• Downloading
• Media apps

It is estimated that this new measure could raise 3 billion baht for the Revenue Department.