New tax incentives for tech and jewelry industries

Investors in the tech industry can look forward to 13 year corporate income tax holidays if they apply for Board of Investment promotion in two selected categories; this up from the 8 years offered to other industries. Investments will be divided into two categories; one including biotechnology, nanotechnology, advanced materials technology and digital technology and one that includes enabling services such as research and development (R&D), science and technology training, electronic design, engineering design services, scientific laboratory services and standardization services. Investors in other businesses will be able to claim tax deductions for expenses on R&D of 300% from 200% if they invest more in technological or human resource development. In 2016 the total investment value of applications to the BoI reached 580 billion baht of which 51% or 290 billion baht were from investment applications in 10 targeted industries the government aims to promote. Those industries include digital and medical services, next-generation cars; smart electronics; affluent, medical and wellness tourism; agriculture and biotechnology; food; robotics for industry; logistics and aviation; and biofuels and biochemicals.

Jewelry and gems businesses also were approved for tax incentives with a twofold corporate tax deduction on expenses incurred while employing skilled workers who are registered with the Skill Development Department. Other incentives include an import tariff waiver for raw materials used in jewelry and ornament production, a cut in tariffs for imported finished products from 20 percent to 10 percent and 1 percent income tax deduction for individual sellers of raw materials for jewelry as well as a VAT exemption for imports of raw materials. The government also approved a VAT waiver for businesses that import raw materials or semi-finished products. Thailand’s jewelry industry is ranked 8th in the world.

The Cabinet extended free tourist visas and discounts on visas on arrival for nationals of 21 countries until the end of August last week. Visa fees are waived at Embassies and Consulates and citizens of countries obtaining visas on arrival see their fees halved to 1,000 baht. Those countries include Andorra, Bulgaria, Bhutan, China, Cyprus, Ethiopia, Fiji, India, Kazakhstan, Latvia, Lithuania, the Maldives, Malta, Mauritius, Papua New Guinea, Romania, San Marino, Saudi Arabia, Taiwan, Ukraine and Uzbekistan. The measure, which was put in place in December 2016, saw tourist arrivals from January 1 -20 jump six percent year on year to 1.8 million international arrivals. There were 32.6 million tourist arrivals in Thailand in the entire year of 2016.

Work Permit

Any foreigner working in Thailand must obtain a Work Permit before beginning work. While a prospective employer may file an application on the foreigner’s behalf in advance of his starting work, the actual Work Permit will not be issued until the foreigner has entered Thailand in accordance with the immigration laws and has presented himself to receive his Work Permit.

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