Current Date: 28 May, 2024

Thailand approves personal income tax exemption for token earnings

The Thai government has approved tax breaks for individuals holding investment tokens in an effort to promote the use of investment tokens for fundraising. 

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On March 13, local media outlet Bangkok Post reported that the Thailand cabinet had approved the tax breaks for investment token holders. In the report, the director-general of Thailand’s revenue department, Kulaya Tantitemit, said that individuals who made a profit from holding investment tokens and had a 15% withholding tax deducted could exclude this income when calculating their personal income tax. 

Tantitemit said that the tax measures, effective Jan. 1, aim to promote fundraising using investment tokens and establish the country as an investment hub. The government official believes that this move will boost the country’s economy by having positive effects on investment and employment in the region.

However, while the tax break was approved, the ruling will only apply to individuals who do not request full or partial refunds of the deducted tax or claim a deducted tax credit.

Apart from individuals, the Thai government also introduced tax breaks for issuers of investment tokens. On March 7, the Thai government announced that corporate income tax and value-added tax (VAT) for investment token issuers have been waived.

Deputy government spokesman Rachada Dhnadirek explained that this way, firms will have access to an alternative fundraising method, like investment tokens, in addition to traditional fundraising. The official said the government expects investment tokens to generate about $3.7 billion in capital over the next two years.

Crypto taxation in Thailand has proved a rocky journey for regulators. In January 2022, Thailand introduced a 15% capital gains tax on crypto traders operating in the country. At the time, the government urged investors to calculate and report their crypto income in tax declarations to avoid penalties.

However, the decision to introduce the capital gains tax was met with public backlash. On Feb. 1, 2022, Thailand decided to suspend the 15% capital gains tax implementation after traders strongly opposed the move.

The country eased up on tax regulations, revising the tax policy to allow exemptions over a month later. On March 8, 2022, the country introduced a new tax policy exempting traders on authorized exchanges from a 7% VAT on crypto.

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Excellence Chukwuma Chukwunaedu

Excellence Chukwuma Chukwunaedu

I enjoy marketing, technology and business. I help businesses and brands connect with their ideal customer profiles and build products that excite them and solve their problems.