The amended ministerial regulation to pave the way for imposing tax on tutorial schools will soon go to Finance Minister Sommai Phasee for approval in a move expected to raise up to 2 billion baht in revenue.
The tax is expected to come into force this year, Revenue Department director-general Prasong Poontaneat said.
Under the amended regulation, privately owned schools will still be exempt from tax.
Tutorial schools have long enjoyed privileges from corporate income tax and VAT because previous governments considered them educational institutes.
Tutorial schools have mushroomed in Thailand as they generate extremely high revenue but need little investment. There are more than 100 large tutorial schools, almost all in Bangkok.
Once the amended regulation takes effect, tutorial schools that generate revenue of 5-30 million baht will be subject to corporate income tax for small and medium-sized enterprises (SMEs), while those with higher revenue will be liable to pay tax at 20% of net profit.
According to the current tax rates on SMEs, the first 300,000 baht of net profit is waived, 300,000 to 3 million baht is collected at 15% and more than 3 million baht at 20%.
The Revenue Department, the largest contributor to the government's coffers, is striving to achieve its tax collection target amid the lacklustre economy.
The government's revenue collection for the first four months of this fiscal year at 665 billion baht was 1.1 billion or 0.2% higher than targeted and 1% more than in the previous fiscal year. This was largely attributable to larger contributions from state enterprises and higher excise tax on diesel after the recent hike.
The government aims to collect 2.325 trillion baht in revenue this fiscal year.
The three tax-collecting agencies mustered 657 billion baht in revenue for the first four months, falling 15 billion short of target but rising 2.7 billion over the same period in the previous year.
Of the 657 billion baht, the Revenue Department contributed 475 billion, the Excise Department 142 billion and the Customs Department 40 billion.
Mr Prasong said the Revenue Department planned to hold a seminar for tutorial school operators before the tax was levied.
The department also wants to include e-commerce operators in the tax system to boost its revenue.
Only 261 of more than 200,000 e-commerce operators pay tax, Mr Prasong said, adding that most have not filed any tax claims because their revenue was less than 1.8 million baht a year — a level not subject to tax payment after deducted expenses.