Thailand’s BOI Investment Promotion Year 2019

Thailand's BOI Investment Year 2019

Thailand's BOI Investment Year 2019

Thailand’s Board of Investment measures in 2019

The size and scope of BOI investment promotion are getting more complex each year. This update for 2019 starts with a competitiveness enhancement promotion regarding technology and innovation for 

  • priority industry and services,
  • research and development, as well as
  • the so-called Thailand Investment Year program to stimulate investments by targeted industries that will drive economic transformation.

Potential Area Developments are focussed on the Eastern Economic Corridor and capital market developments by SET/MAI listing incentives for all BOI-approved projects under the listed entity – given that those projects are approved prior to the listing.

New human capital incentives are granted for domestic HR developments, as well as to attract foreign talents by the smart visa programs. In addition, productivity enhancement and environment protection are focussed on automation, digitalization, renewable energy/energy savings, as well as the alleviation of environmental impacts, R&D, and engineering design.

An additional focus is on decentralization and inequality reduction. This covers

  • Special Economic Development Zones (SEZs) inTak, Sa kaew, Trat, Mukdahan, Songklah, Nongkhai, Narathiwas, Chiang Rai, Nakhon Panom, Kanchanaburi (10 provinces, 23 districts, 90 sub-districts)
  • the border provinces Narathiwat, Pattani, Yala and Satun and 4 districts (Jana, Na Thawee, Saba Yoi, Dhepha) in Songkhla in Southern Thailand,
  • 20 Provinces with lowest per capita income (Kalasin, Chaiyaphum, Nakhon Phanom, Nan, Bueng Kan, Buri Ram, Phrae, Maha Sarakham, Mukdahan, Mae Hong Son, Yasothon, Roi Et, Si Sa Ket, Sakhon Nakhon, Sa Kaew, Sukhothai, Surin, Nong Bua Lamphu, Ubon Ratchatani and Amnatcharoen)
  • SMEs Incentives and the so-called Grassroots Economy Development.

Activity-based incentives

Incentives are largely based on several key factors i.e. the level of technology and the role in the supply chain. Different incentives apply under these categories:

  • A1: Knowledge-based activities focusing on R&D and design to enhance the country’s competitiveness
  • A2: Infrastructure activities for the country’s development, activities using technology to create value-added, with no or very existing investments in Thailand
  • A3: High technology activities which are important to the development of the country, with a few investments already existing in Thailand
  • A4: Activities with lower technology than A1-A3 but which add value to domestic resources and strengthen the supply chain
  • B1/B2: Supporting industry that does not use high technology, but is still important to the value chain

Competitiveness Enhancement Incentives

Additional 1-3 years of tax holidays can be granted if expenditures/investments in the following categories reach the minimum threshold. Main fields are

  • R&D
  • Donations to technology and human resource development funds, educational institutions, training centers, R&D institutes or governmental agencies in the S&T field
  • IP acquisition/licensing fees for technology developed in Thailand
  • Advanced technology training
  • Development of local suppliers, and
  • Product & packaging design

Productivity Enhancement Measures

This type of investment promotion is granted for 

  • Replacement or the upgrade of machinery for energy conservation, alternative energy utilization, reduction of environmental impacts
  • Replacement or the upgrade of machinery for efficiency enhancement, e.g. Automation, Digitalization
  • Investments or spending in R&D and advanced engineering designs
  • Upgrade of production lines to acquire international agricultural industrial standard.
Extensive background information and long-lasting experiences with the BOI policy and behavior are available on request. It is essential to carefully design and structure the foreign direct investment to be cost-, tax-, and BOI-effective.

Legal services on BOI investment promotions

PUGNATORIUS Ltd. is a Bangkok-headquartered specialist provider of bespoke transactional legal and tax advice in the corporate and property legal and taxation industry sectors. BOI-related professional services cover these seven aspects:

  • BOI promotion advice
  • BOI application support
  • Ongoing reporting and compliance requirements
  • BOI promotion management
  • Restructuring and exit advice
  • BOI tax advice
  • Legal opinions and professional reports

The scope of professional services is described at “Legal and tax services on BOI investment promotions“.

Disclaimer: A little knowledge is a dangerous thing. This low-resolution high-level outlook constitutes neither legal advice nor an attorney-client relationship.

Comments are now closed for this article.