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The Thailand Board of Investment (the “BOI”) has approved a series of measures with an aim to stimulate national economy in 2021, especially in respect of the target industries and the adoption of digital technologies. Key details of the approved scheme are set out below.
- Large-scale projects
In order to stimulate economic recovery from the adverse impact of Covid-19, a large-scale investment has been endorsed to purposely accelerate investment in the target industries. Projects having a realised investment of at least Baht 1 billion within 12 months from issuance of the promotion certificate will be entitled to a deduction of 50% of corporate income tax (CIT) for five years after the end of the standard 5-8 years tax holiday. An application can be submitted from January 4 to the last business day of 2021.
- Extension for Special Economic Zones (SEZ)
An application period for investment in 10 border provinces (namely Kanchanaburi, Chiang Rai, Trat, Tak, Nakhon Phanom, Narathiwat, Mukdahan, Songkhla, Sa Kaeo and Nong Khai) has been extended to the end of 2022. Apart from standard incentives applicable to over 300 SEZ promoted activities, 14 target businesses (e.g. agriculture, fisheries, textiles, garments, leather, furniture, jewellery, ornaments and etc.) are entitled to the 8-year CIT exemption and 50% CIT deduction for five years after the end of the tax holiday.
Likewise, an application deadline has been extended to the end of 2022 for projects located in five southernmost provinces (namely Yala, Pattani, Narathiwat, Satun and Songkhla) which are eligible for the 8-year CIT exemption and 50% CIT deduction for five years after the end of the tax holiday.
- Digital technologies
In order to leverage the adoption of digital technologies for business operation (e.g. software integration, artificial intelligence (AI), machine learning and big data analytics and etc.), any project with an investment amount of at least Baht 1 million (excluding the cost of land and working capital) or Baht 500,000 in case of SMEs will be entitled to the 3-year CIT exemption at 50% of the investment capital. An application can be submitted until the end of 2022.
- New SEZ for the Medical Genomics Projects
Following approval on the establishment of the new special economic zone of medical genomics at Burapha University, medical genomics projects located at Burapha University (Bangsan) will enjoy the same additional tax incentives from the BOI as other EEC projects located at EECa, EECi, EECd, and EECmd areas.
This document is solely intended to provide an update on recent development in Thailand legislation and is not purported to provide a legal opinion, nor a legal advice to any person.