Investors who move cryptocurrencies and digital tokens through Thailand 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 judgment is now part of Thai law, as it takes effect the day after it is published in the official journal.
Thailand’s decision to promote cryptocurrency
The major goal of the tax exemption, according to the document, is to promote cryptocurrency trading on recognized exchanges, 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 foolproof that the country’s cryptocurrency exchange will become more dependable and stable as a result of the reduced tax restrictions.
Ekniti Nititthanprapas, Director-General of the Revenue Department, noted that crypto trading would 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 directive published on May 24 exempts transfers done with the retail central bank digital currency of Thailand’s monetary authority from VAT (CBDC).
In December, the Bank of Thailand said it would begin testing the CBDC as an additional payment option in financial institution-to-customer transactions in late 2022.
Thailand has seen a substantial increase in cryptocurrency investment and trade in recent years. The country’s financial regulators took 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.