Investors who move cryptocurrencies and digital tokens through Thai exchanges will be eligible for a 7% VAT exemption on their transactions. The tax break was enacted retroactively from April 1, 2022, according to a decree published in the Royal Gazette on Tuesday. According to local media, it will stay in effect until December 31, 2023.
The government approved the policy in March, and it applies to trading platforms that are registered with the Ministry of Finance. The judgement is now part of Thai law, as it takes effect the day after it is published in the official journal.
The major goal of the tax exemption, according to the document, is to promote cryptocurrency trading on recognised exchanges by allowing crypto transactions to be regulated and supervised by appropriate authorities such as the Securities and Exchange Commission (SEC).
Thailand’s Finance Minister, Arkom Termpittayapaisit, is certain that the country’s cryptocurrency exchange will become more dependable and stable as a result of the reduced tax restrictions.
He further stated:
“This would encourage Thailand to develop infrastructure and payment systems that are ready for the digital economy of the future.”
Ekniti Nititthanprapas, Director-General of the Revenue Department, noted that crypto trading will be easier for investors, who will benefit from fair tax treatment and secure transactions, while Thailand’s image in the global digital sector improves.
Another royal decree, also announced on May 24, extends the VAT exemption to transfers using Thailand’s monetary authority’s retail central bank digital currency (CBDC). The Bank of Thailand said in December that it plans to begin testing the CBDC as an alternative payment method in late 2022 in transactions between financial institutions and customers.
Thailand has seen a substantial increase in cryptocurrency investment and trade in recent years. The country’s financial regulators made efforts to prohibit the use of cryptocurrencies for payments in late March, citing the need to avert different financial and economic concerns, with the SEC releasing guidelines meant to deter digital asset operators from offering such services.
Read more: Russian federation revises draft to reduce tax exemptions for mining operations
