The government in Thailand has formally introduced a value-added tax exemption for the transfer of cryptos and other digital tokens via government-approved exchanges. The tax break issued would be in force until the end of 2023.
Notably, the cabinet granted the VAT exemption back in March, but the decision was enacted into Thai law yesterday. This essentially means that investors moving cryptos and digital tokens through exchanges in Thailand would now save 7% tax.
Per the translation of the original announcement, the key goal of the exemption is to foster crypto trading on recognized exchanges and allow crypto transactions to be administered by the right authorities like the Securities and Exchange Commission (SEC).
In fact, per Thailand’s Finance Minister—Arkom Termpittayapaisit—the relaxed tax rules would make crypto exchanges in the country more reliable and stable. He said,
“This would encourage Thailand to have an infrastructure and payment system that would be ready for the future digital economy.“
Further, the Director-General of the Revenue Department—Ekniti Nititthanprapas—added that crypto trading would become more convenient for investors who enjoy fair tax treatment and safe transactions With this move, Thailand also intends to improve its image in the global digital space.
Also, another royal order that was also published around the same time extended the VAT exemption to transfers with a retail central bank digital currency (CBDC) issued by Thailand’s monetary authority. Here it is worth recollecting that back in December last year, the Bank of Thailand announced that it intended to begin the retail CBDC pilot testing in late 2022 via transactions between financial institutions and users.
Well, digital asset adoption has surged at quite a quick pace in Thailand over the past year. During the beginning of the year, a ministry official had brought to light that the trading accounts had surged to around 2 million from merely 170,000 over the past year. So, keeping in mind the crypto inclination of Thais, the latest enforcement seems to be quite encouraging.