The Practical | Episode 1: Why does tax matter?
Tax podcastsGT Thailand's tax podcast series, including The Practical, covering tax and legal topics for businesses in Thailand
Why does tax matter?
Welcome to The Practical by Grant Thornton, Thailand. A podcast series where our Tax & Legal experts share practical perspectives on the issues shaping businesses and society.
In Episode 1, we explore a fundamental question that affects every economy and every taxpayer. Why does tax matter?
Through this discussion, we step back from technical rules and examine the broader purpose of taxation. Beyond compliance, taxes play an important role in funding public services, supporting economic development and shaping public policy.
Our hosts also discuss how different countries approach taxation, why some economies rely less on traditional taxes and why sustainable sources of revenue remain essential to long term prosperity.
Whether you are a business owner, finance professional or simply curious about the role tax plays in everyday life, this episode provides practical insights into one of the foundations of every modern economy.
Follow our podcasts:
GT Thailand's tax podcast series, including The Practical, covering tax and legal topics for businesses in Thailand
Thailand’s position on Article 12 (Royalties) of the recent 2025 OECD report reflects a robust commitment to source-based taxation for cross-border payments. Unlike the OECD’s preferred move towards residence-based taxation for royalties, Thailand continues to advocate for the right of the state where the income arises to collect tax. By expanding the definition of royalties and establishing clear source rules, Thailand ensures that a broad spectrum of payments for technology, equipment, and expertise remains subject to local withholding tax.
In the recent 2025 OECD report, Thailand has reaffirmed its position as a "Non-Member Economy" that prioritizes source-based taxation. By maintaining specific reservations on Article 5 - Permanent Establishment or “PE”, Thailand aims to ensure that foreign enterprises contributing to its economy through sustained physical or economic presence do not circumvent local tax obligations. These positions reflect a cautious approach toward the global trend of narrowing PE definitions, focusing instead on traditional and service-based activities.
The Royal Thai Government Gazette has announced the Labour Protection Act (No. 9), B.E. 2568 (2025) (“Amendment No. 9”), which amends key provisions under the Labour Protection Act B.E. 2541 (1998) (“Labour Protection Act”). The amendments are effective from 7th December 2025 introduce new protections, leave entitlements and employer compliance requirements.
The rapid shift toward hybrid and remote work has created a complex challenge for multinational enterprises: when does an employee’s home office create a taxable presence, or Permanent Establishment (PE), in another country? The recent 2025 OECD report addresses this head-on, providing much-needed clarity through revised commentary on Article 5 (Permanent Establishment or PE). For businesses with cross-border talent, these changes offer a more practical framework for assessing tax exposure in jurisdictions where employees may be working remotely.
The Thai Revenue Department (TRD) sets higher tax collection targets each year, increasing pressure on both the tax authority and taxpayers. The TRD is accelerating its transformation towards an AI-enabled, data-driven administration to enhance operational effectiveness and improve overall tax collection.