Thailand Empowers Crypto Economy with Tax Breaks for Investment Token Holders and Issuers
Summary:
Thailand's government has approved tax incentives for investment token holders and issuers to encourage fundraising and position the country as an investment hub. The measure exempts individuals who profit from holding tokens from having to include this income in their personal income tax calculations. Likewise, corporate income tax and VAT have been waived for investment token issuers. The Thai government anticipates that these policies could generate approximately $3.7 billion in capital over the next two years. Taxation policy for cryptocurrencies has also been revised, with the latest implementation exempting authorized traders from a 7% VAT on their crypto transactions.
Thailand's government has authorized financial incentives for individuals possessing investment tokens as part of its initiative to encourage the utilization of these tokens for raising funds. On March 13, it was revealed through a Bangkok Post report that the Thailand cabinet had sanctioned these incentives. The revenue department's director-general, Kulaya Tantitemit, clarified that people who profited from their investment tokens and had a 15% withholding tax deducted could subtract this income from their personal income tax calculations. Tantitemit pointed out that these effective tax measures from January 1 are aimed at sparking a rise in fundraising through investment tokens and positioning the country as an attractive investment hub. She also suggested that this strategic move would bolster the economy, leading to an increase in investment and job opportunities across the nation. However, this tax benefit is limited to individuals who do not seek a full or partial tax refund and do not claim a tax credit. Besides individuals, investment token issuers also benefit from tax incentives introduced by the Thai government. The government announced on March 7 that both corporate income tax and value-added tax (VAT) for these issuers have been exempted. Deputy government spokesperson Rachada Dhnadirek clarified that the rationale behind this move was to pave the way for firms to explore alternative fundraising channels including investment tokens, in conjunction with conventional methods. The government anticipates that within two years, these investment tokens could potentially amass around $3.7 billion in capital. However, carving out a crypto taxation strategy in Thailand has been met with various challenges. In January 2022, Thailand imposed a 15% tax on capital gains from crypto trading within the country. The government then advised investors to accurately calculate and disclose cryptocurrency-related income in their tax filings, warning of potential penalties for non-compliance. But, faced with widespread public dissidence, Thailand chose to delay the implementation of the 15% capital gains tax. Subsequently, tax rules were relaxed and exemptions were added in over a month. On March 8, 2022, a new taxation policy was rolled out that excludes traders on approved exchanges from a 7% VAT on any cryptocurrency transactions.
Published At
3/13/2024 3:48:23 PM
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