Thailand’s crypto-friendly stance continues as the country positions itself to be a dominant player in the sector with lucrative tax incentives for investor token issuers.
The news about the Thai government plan was revealed by Reuters on March 7th.
The spokesperson for the Thai government confirmed the news. Based on the representative, the government gave a green light to a crypto-friendly tax policy that offers tax breaks for companies issuing digital investment tokens.
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In particular, the policy will allow qualifying crypto companies to be exempt from paying corporate income tax and value-added tax (VAT).
In the announcement, deputy government spokesperson Rachada Dhnadirek stated that companies operating in Thailand would be authorized to raise capital using alternative means like investment tokens. It would work similarly to Initial Coin Offerings (ICOs) and traditional methods like debentures and bonds.
The government predicts that investment token offerings could generate up to $3.7 billion by 2025. In the same period, the government expects to lose tax revenue of around $1 million.
Thailand’s crypto regulation has evolved significantly in the past few years. Authorities in the country have been working on setting up precise rules for the sector to protect investors. At one point, Thai authorities proposed a 15% capital gains tax.
However, those plans were later disregarded, and a 7% VAT tax exemption for crypto traders using authorized exchanges was implemented. In 2022, the country's Securities and Exchange Commission (SEC) banned using crypto for payments.
Thailand is set to become the latest country to embrace virtual banking, with the Bank of Thailand announcing plans to issue three licenses in 2024, allowing operations to begin in 2025.
