Seven opportunities: New Thailand Board of Investment promotion regime 2018
The BOI investment promotion is extended sevenfold in 2018
Under the current investment promotion regime, Thailand’s Board of Investment promotes roughly 40 business activities in eight sections:(i) Agriculture and Agricultural Products, (ii) Mining, Ceramics and Basic Metals, (iii) Light Industry, (iv) Metal Products, Machinery and Transport Equipment, (v) Electronic Industry and Electric Appliances, (vi) Chemicals, Paper and Plastics, (vii) Services and Public Utilities and, finally, (viii) Technology and Innovation Development.
Under a new promotion scheme, the BOI investment promotion will be extended sevenfold in 2018. These are the known facts as of the date this post is published (updates will follow soon):
1. 100 instead of 40 business activities: On December 18, 2017, the BOI approved additional incentives to cover more than roughly 100 business activities. The list of one hundred activities is not yet released to the public. These additional activity-based incentives will depend on the business’ character as SME and other criteria.
2. Improvements for existing 40 business activities: As announced by the BOI, some conditions are relaxed for the existing already promoted business activities.
3. Extended tax incentives: Tax benefits are upgraded to be more attractive. The ceiling of corporate income tax exemption is increased from normally 100 percent to 200 percent, for activities eligible to obtain tax holidays, meaning the amount of tax exemption on capital investment will be doubled.
4. Additional merit-based incentives: Research and development, advanced technology training, IP licensing fees, product and packaging design and other activities that enhance competitiveness will receive significantly relaxed investment and expense conditions, partially limited to SME.
5. 20 provinces with lowest per capita income: SME activities that are eligible for eight-year tax holidays will receive an additional 50 percent tax reduction for another five years. Other activities that are eligible for tax holidays will receive an additional three-year exemption, on top of normal tax exemption.
6. EEC promotion scheme: Targeted activities in the Eastern Economic Corridor of Innovation (EECi) and the Digital Park Thailand (EECd), will be eligible for special EEC tax incentives.
7. Special human resource development tax holidays: Two more years of tax holidays on top of normal incentives and 50 percent CIT reduction for another five years under certain conditions in the EEC.
PUGNATORIUS Ltd. is a Bangkok-based specialist provider of bespoke transactional legal and tax advice in the corporate and property legal and taxation industry sectors. The scope of BOI-related professional services is outlined here.