Investment promotion: Thailand Plus

published on September 26, 2019 / reading time approx. 2 minutes

The Thai Board of Investment (BOI) approved additional investment incentives ("Thailand Plus") to facilitate investment in Thailand. The official announcement of Thailand Plus is still outstanding.

According to the press release, the following measures have been approved:

Reduction of Corporate Income Tax: Investments promoted by the BOI will receive further five years of corporate income tax reduction of 50 percent, provided that an investment of THB 1 billion (approx. EUR 30 million) is made prior to December 2021. Under the current investment policy, projects are eligible for activity and merit-based tax exemptions and reductions, depending on the kind and location of the investment. The tax reduction under the Thailand Plus-scheme will be added on top of other tax incentives.
Deductions for training and investment in automation:

a) Employers can deduct costs for enlisting employees in training courses endorsed by the Ministry of Higher Education, Science, Research, and Innovation. The training should either re-skill or upskill the employee. Hiring expenses for employees highly skilled in science or technology will be eligible for special deductions, too. The overall goal is to incentivize training in the fields of science, technology, engineering, and math.

b) Investments in automation systems shall be eligible for double deductions. Over the last decade, Thailand has taken several steps to increase efficiency by automation.

3. Steering Committee: The government will create a new investment steering committee, chaired by the Prime Minister. The committee will be responsible for the coordination and facilitation of large investment projects.

Additionally, the Prime Minister has ordered a review of regulations (relating to foreign investment, taxation, customs, etc.) in order to enhance the overall competitiveness of Thailand regarding foreign direct investment. BOI Secretary-General, Duangjai Asawachintachit, clarified that the government is trying to increase the ease of doing business in Thailand.

The details of the Thailand Plus-scheme remain to be seen. However, it is a good sign that Thailand keeps reviewing and improving investment incentives. The corporate income tax reduction seems to aim at Chinese investment. Apparently, Chinese investors are looking at locations in the region to avoid tariffs imposed in the wake of the US-China trade war.