Thailand continues to be a desirable location for foreign investors, mainly because of its robust tourism industry. As a result, many entrepreneurs seek investment opportunities that can attract local and foreign clients.
Opening a bar in Thailand can be an exciting and lucrative business enterprise, provided it complies with the rules set forth by the Foreign Business Act for expatriates or foreign investors who wish to settle in the country and make profits. However, there are several conditions and requirements to consider when contemplating the establishment of a bar in Thailand;
• Partnership with a Thai citizen: foreign citizens must have a Thai partner who must own a 51% ownership stake in the business.
• Unique business name: it is necessary to reserve a unique name for the bar in Thailand.
• Bank account: a bank account with a minimum share capital of THB 2,000,000 is mandatory.
• Tax registration: VAT registration with the relevant Thai authorities is obligatory for the business.
• Business license acquisition: the Trade Register in Thailand will assess the documentation and register the company accordingly.
The liquor license in Thailand is valid for one year and can be renewed within 30 days before the expiration date. The license fee is 200 THB. As you prepare the necessary documents, you must consider translating them into Thai to ensure you understand and comply. Notably, opening an establishment near a school is strictly prohibited. In addition, Thai law bans any bar from operating within 500 meters of schools. Violation of this regulation may result in the rejection of the application.
The process of obtaining a liquor license in Thailand is a crucial requirement for establishments intending to sell alcoholic beverages, whether it be a restaurant or a bar. The responsibility of issuing liquor licenses lies with the District Office in Thailand, which carefully evaluates certain essential documents, including:
• The company’s documents, including the Value Added Tax (VAT) certificate.
• Lease or rental documents for the location where the establishment will operate.
• Identification documents of the bar owners seeking permission to sell alcoholic beverages.
It is important to note that businesses, whether locally incorporated or foreign, are subject to corporate income tax and other applicable taxes in Thailand. This tax obligation applies to both independent companies and those operating under a franchise model. The taxation regulations typically encompass various categories:
• Corporate income tax: imposed at a rate of 20%, with progressive rates available for smaller businesses.
• Capital gains tax: set at a rate of 20%.
• Withholding tax: applied at different rates, such as 10% for dividends paid to another Thai company, 15% for interest paid to a non-resident company, and 3% advance withholding tax for royalties paid to another Thai company.
• Real property tax: levied at a rate of 12.5% based on the appraised rental value of the property, with the maximum tax rate varying according to the type of land or building.
• Social Security: requires a 5% contribution from both the employer and the employee, based on the employee’s monthly salary, subject to a predetermined monthly cap.
• Stamp duty: imposed at a rate of 0.1% in cases involving leases, share transfers, and other relevant transactions.
• Specific business tax: applicable to specific transactions in the banking sector and gross proceeds from immovable property transfers, with a rate of 3%.
Understanding and adhering to these taxation regulations is crucial for businesses operating in the hospitality industry in Thailand.
Once you have that license, you must stock that bar with quality booze. Then, you can sign a contract with a single supplier (which may lead to preferential prices but can mean that the types of products are limited) or purchase freely at different prices.
Why don’t you visit our Pub and Bar Asia 2023 tradeshow and explore the opportunities?
PUB & BAR ASIA (PBA 2023) is Thailand’s first dedicated international show for Thailand and ASEAN’s rapidly growing pub, bar, and licensed entertainment industries.
PBA 2023 is here to help you discover the latest products, update new trends, meet new suppliers and networking with like-minded professionals. The 4-day show has thousands of new products from innovative equipment, alcoholic/non-alcoholic drinks, mixers, and ingredient and store solutions.
In collaboration with industry associations, chambers of commerce and exhibitors, visitors will significantly benefit from bespoke activities such as;
• Bartender Show
• Beer Tasting
• Craft Beer Workshop & Discussion
• Wine Tasting
Pre-register to visit the show today: