Harmful Tax Practices – 2022 Peer Review Reports on the Exchange of Information on Tax Rulings

Thailand

Thailand has met all aspects of the terms of reference (OECD, 2021[1]) (ToR) for the calendar year 2022 (year in review), except for the timely exchange of information on future rulings (ToR II.B.6). Thailand receives one recommendation on this point for the year in review.

In the prior year report, Thailand had received one recommendation, related to having a domestic legal framework allowing spontaneous exchange of information on rulings. Thailand has resolved this issue, and the recommendation is removed. However, as Thailand experienced delays in the exchange of information on future rulings, a new recommendation has been made as relevant.

Thailand can legally issue one type of rulings within the scope of the transparency framework.

In practice, Thailand issued rulings within the scope of the transparency framework as follows:

 

Type of ruling	Number of rulings
Past rulings	182
Future rulings in the period 1 April 2018 – 31 December 2018	36
Future rulings in the calendar year 2019	157
Future rulings in the calendar year 2020	23
Future rulings in the calendar year 2021	21
Future rulings in the year in review	74

Peer input was received from two jurisdictions in respect of the exchanges of information on rulings received from Thailand. The input was generally positive, noting that overall information was complete, in a correct format and almost all received in a timely manner. However, one peer input indicated that exchanges on rulings were not timely.

Information gathering process (ToR I.A)

1179. Thailand can legally issue the following type of ruling within the scope of the transparency framework: preferential regimes.1

1180. For Thailand, past rulings are any tax rulings within scope that are issued either: (i) on or after 1 January 2016 but before 1 April 2018; or (ii) on or after 1 January 2014 but before 1 January 2016, provided they were still in effect as at 1 January 2016.

1181. In the prior years’ peer review reports, it was determined that Thailand’s undertakings to identify past rulings and all potential exchange jurisdictions were sufficient to meet the minimum standard. Thailand’s undertakings in this regard remain unchanged, and therefore continue to meet the minimum standard.

1182. Thailand has met all of the ToR for the information gathering process and no recommendations are made.

Exchange of information (ToR II.B)

Legal basis for spontaneous exchange of information (ToR II.B.1, II.B.2)

1183. In the prior years’ peer review reports, it was determined that Thailand did not have the necessary domestic legal basis to exchange information spontaneously. Thailand received a recommendation for this.

1184. During the year in review, Thailand made an amendment to Section 10 of the Revenue Code, which is a new legal provision allowing spontaneous exchanges of information. The amendment entered into effect on 25 January 2022, and Thailand has commenced the relevant exchanges regarding the Action 5 transparency framework as of that date. As the legal impediments have been lifted in 2022 and Thailand now has a domestic legal framework which allows spontaneous exchange of information on rulings, the prior years’ recommendation is removed.

1185. Thailand has international agreements permitting spontaneous exchange of information, including: (i) the Multilateral Convention on Mutual Administrative Assistance in Tax Matters: Amended by the 2010 Protocol (OECD/Council of Europe, 2011[2]) (“the Convention”) and (ii) bilateral agreements in force with 61 jurisdictions.2 Thailand signed the Convention on 3 June 2020 and deposited its instrument of ratification on 22 December 2021. The Convention entered into force on 1 April 2022 and will have effect for administrative assistance related to taxable periods beginning on or after 1 January 2023.

Completion and exchange of templates (ToR II.B.3, II.B.4, II.B.5, II.B.6, II.B.7)

1186. For the year in review, the timeliness of exchanges is as follows:

 

Past rulings within the scope of the transparency framework	Number of exchanges transmitted by 31 December 2022	Delayed exchanges
		Number of exchanges not transmitted by 31 December 2022	Reasons for the delays	Any other comments
	746	0	N/A	N/A
Future rulings within the scope of the transparency framework	Number of exchanges transmitted within three months of the information becoming available to the competent authority or immediately after legal impediments have been lifted	Delayed exchanges
		Number of exchanges transmitted later than three months of the information on rulings becoming available to the competent authority	Reasons for the delays	Any other comments
	345	913	See below.	N/A
Total	1 091	913

 

Follow-up requests received for exchange of the ruling	Number	Average time to provide response	Number of requests not answered
	0	N/A	N/A

1187. As Thailand has the necessary domestic legal basis to exchange information on rulings as of 2022, it has now commenced exchanges. Out of the 2,004 exchanges to be transmitted from previous years, 1,091 exchanges were processed in 2022, including all information on past rulings. Thailand notes that the remaining exchanges related to future rulings will be completed by the second quarter of 2023. Therefore, Thailand is recommended to ensure that the remaining exchanges of information on future rulings occur as soon as possible.

Conclusion on section B

1188. Thailand has the necessary domestic legal basis for spontaneous exchange of information and has a process for completing the templates in a timely way. In the prior year’s peer review report, Thailand received a recommendation to finalise the amendments to put the domestic legal basis in place to commence exchanges. Thailand has completed this during the year of review. Thailand has met all of the ToR for the exchange of information process, except the timely exchange on future rulings. Thailand is still in the process of completing exchanges and is expecting to finalise this in 2023. Therefore, Thailand receives one recommendation to exchange the information on the remaining rulings on this point for the year in review.

Statistics (ToR IV.D)

1189. The statistics for the year in review are as follows:

 

Category of ruling	Number of exchanges	Jurisdictions exchanged with
Ruling related to a preferential regime	1 091	Australia, Bangladesh, Belgium, Bulgaria, Cambodia, Canada, Chile, China (People’s Republic of), Cyprus, Czechia, Denmark, Finland, France, Germany, Hong Kong (China), Hungary, India, Indonesia, Ireland, Israel, Italy, Japan, Korea, Lao People’s Democratic Republic, Luxembourg, Malaysia, Mauritius, Myanmar, Netherlands, New Zealand, Norway, Oman, Pakistan, Philippines, Poland, Romania, Russia, Seychelles, Singapore, South Africa, Spain, Sri Lanka, Sweden, Switzerland, Chinese Taipei, Türkiye, United Arab Emirates, United Kingdom, United States, Viet Nam

Matters related to intellectual property regimes (ToR I.A.1.3)

1190. In the prior years’ peer review reports, it was determined that Thailand offers an intellectual property regime3 for which no transparency requirements under the Action 5 Report (OECD, 2015[3]) were imposed.

Summary of recommendations on implementation of the transparency framework

 

Aspect of implementation of the transparency framework that should be improved	Recommendation for improvement
Thailand implemented a legal provision which has taken effect in 2022 and now has the necessary legal framework to exchange information on rulings spontaneously. Thailand has commenced exchanges of information on past and future rulings. However, Thailand still experienced delays on exchanges of information on future rulings during the year in review.	Thailand is recommended to exchange information on the remaining future rulings as soon as possible.

References

[1] OECD (2021), BEPS Action 5 on Harmful Tax Practices - Terms of Reference and Methodology for the Conduct of the Peer Reviews of the Action 5 Transparency Framework, OECD Publishing, Paris, https://www.oecd.org/tax/beps/beps-action-5-harmful-tax-practices-peer-review-transparency-framework.pdf.

[3] OECD (2015), Countering Harmful Tax Practices More Effectively, Taking into Account Transparency and Substance, Action 5 - 2015 Final Report, OECD/G20 Base Erosion and Profit Shifting Project, OECD Publishing, Paris, https://doi.org/10.1787/9789264241190-en.

[2] OECD/Council of Europe (2011), The Multilateral Convention on Mutual Administrative Assistance in Tax Matters: Amended by the 2010 Protocol, OECD Publishing, Paris, https://doi.org/10.1787/9789264115606-en.