Tax Burden Comparison in Four Southeast Asian Countries 2024: Corporate Income Tax, VAT, and Digital Services Tax

Tax Burden Overview in Key Southeast Asian Markets

When Chinese enterprises expand to Southeast Asia, they need to prioritize corporate income tax, VAT, and emerging digital services taxes. Based on 2024 public tax rates, the comparison among Indonesia, Vietnam, Thailand, and Malaysia is as follows.

Corporate Income Tax (CIT)

• Indonesia: Standard rate 22% (2024), can be reduced to 19% for listed companies.
• Vietnam: Standard 20%, preferential 15% for high-tech enterprises.
• Thailand: Standard 20%, with SME progressive rates (0-15%).
• Malaysia: Standard 24%, 17% on the first MYR 600,000 profit.

Value-Added Tax (VAT)

• Indonesia: Standard 11%, planned to increase to 12% in 2025.
• Vietnam: Standard 10%, with reduced rates of 8% or 0% for certain goods/services.
• Thailand: Standard 7%, effectively maintained at this level.
• Malaysia: Sales and Services Tax (SST) at 6%-8%, not traditional VAT.

Digital Services Tax (DST)

• Indonesia: 10% VAT on foreign digital enterprises (treated as DST).
• Vietnam: 5% “foreign supplier tax” on cross-border digital platforms.
• Thailand: 7% VAT on foreign digital services (withheld by platform).
• Malaysia: 6% SST on foreign digital services.

Interpretation

• The stacked bar chart shows total tax burden (CIT+VAT+DST) differences: Malaysia has relatively lower overall burden due to SST, while Indonesia has the highest due to high CIT and DST.
• Digital services tax is becoming a new compliance focus; enterprises must monitor thresholds and registration requirements in each country.