Thailand government is taking steps to capitalize on the growing digital asset business by permitting the tax-free issues of digital tokens for investment.
According to Reuters, Thailand’s cabinet has agreed to eliminate the corporate income tax and value-added tax (VAT) for companies that issue investment tokens.
On March 7, deputy government spokesman Rachada Dhnadirek said that enterprises will be allowed to raise cash through investment tokens in addition to traditional means such as debentures.
Rachada went on to say that the government anticipates investment token offerings would earn 128 billion Thai baht ($3.7 billion) over the next two years. The state predicted that tax revenue losses could total 35 billion baht ($1 million).
Thailand has made numerous moves to clarify local crypto-related taxation legislation, with officials proposing a 15% capital gains tax for investors in early 2022. Following the cancellation of the plans, the government exempted crypto dealers from the 7% VAT on regulated exchanges a few months later.
Last year, local officials were also seeking to establish broader crypto restrictions, with Thailand’s Securities and Exchange Commission prohibiting the use of cryptocurrency for payment in March 2022.
The announcement comes as the Thai SEC continues to work on stronger cryptocurrency laws to protect investors. The financial regulator announced new guidelines for crypto custody services in January 2023, mandating all crypto custodians to have a backup plan in case of unanticipated circumstances.
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