Cabinet Preliminarily Approves Extended Tax Relief Period to Bolster Thailand’s Digital Asset Hub Status
In a progressive stride towards solidifying Thailand’s position as a Digital Asset Hub and ensuring fair treatment for local digital asset business operators, the Cabinet has granted preliminary approval to extend the standard tax relief period for digital asset trading. This bold move, as outlined in the draft Royal Decree effective January 1, 2024, introduces significant measures aimed at streamlining tax payments for investors engaged in digital asset transactions.
Key Provisions of Revenue Department Order No. PorChorSor. 9/2024
Under the current legal framework, specifically Law No. 744, B.E. 2565, Value Added Tax (VAT) exemption was limited to transfers and sales of cryptocurrencies or digital tokens executed solely on exchanges. However, the proposed changes under Revenue Department Order No. PorChorSor. 9/2024 seek to broaden the scope of VAT exemption to encompass transactions involving the transfer and sale of cryptocurrencies or digital tokens for usage (Utility Tokens) through intermediaries such as exchanges, brokers, and dealers.
This shift in policy aligns with the Revenue Code, presenting crucial provisions for VAT exemption applicable to both individuals and juristic persons. Notably, the decree introduces a comprehensive 7 percent VAT exemption for qualifying transactions, including those conducted within digital asset trading centers, facilitated by digital asset brokers, and involving digital asset traders and dealers.
Expected Benefits and Implications
The extension of VAT exemption to encompass a broader spectrum of digital asset transactions holds promise for numerous benefits. Firstly, it ensures equitable treatment for all government-regulated Thai digital asset business operators, eliminating discrepancies in tax obligations. This move not only promotes tax compliance convenience but also instills confidence among investors trading through state-regulated operators, thereby augmenting Thailand’s appeal as a digital asset hub.
Furthermore, the initiative is poised to stimulate economic growth by attracting more investors and bolstering digital asset trading activities within the country. By fostering a conducive regulatory environment, Thailand positions itself as a favorable destination for digital asset businesses, potentially leading to increased revenue and job creation opportunities.
In light of the Cabinet’s preliminary approval of extended tax relief measures for digital asset trading, stakeholders are encouraged to stay informed and capitalize on the evolving regulatory landscape. While the proposed changes signify a progressive step towards enhancing Thailand’s competitiveness in the digital asset sphere, it’s imperative for investors and businesses to seek expert legal advice for a comprehensive understanding of the implications on their tax obligations and operations.
For further clarification or assistance regarding the implications of this order on your tax situation, please do not hesitate to contact us at [email protected] for expert legal advice and guidance.
Disclaimer: This legal update is for informational purposes only and should not be construed as legal advice. Please consult with a qualified attorney for guidance specific to your situation.