Tax and non-tax incentives granted by (BOI)
The Board of Investment (BOI) grants tax and non-tax incentives to companies that are engaging in activities that the (BOI) wants to promote.
Tax incentives granted by the BOI:
- Corporate Income Tax Exemption: Investments in certain industries can enjoy corporate income tax holidays for up to 8 years. For “priority industries” this tax holiday is capped to the amount invested. For “industries of special importance and benefits to the country” there is no corporate income tax cap, i.e. corporate income tax is waived for a predefined time period, irrespective of the amount of capital invested.
- 50% reduction of corporate income tax after the exemption period: After the initial years of corporate income tax exemption mentioned above, the BOI grants a further 50% corporate income tax reduction for certain industries of special importance.
- Import duties exemption on machinery: Import duties on machinery may be waived, for some industries though only if the original import duty is more than 10%
- Import duties exemption on raw or essential materials used in manufacturing of export products
- Import duties on raw or essential materials used in manufacturing products for domestic sale
- Double Tax deduction of transportation, electricity and water costs: To account for higher costs of utilities in lesser developed regions of Thailand, the BOI grants double tax deductions of these costs
- Tax deduction of the project infrastructure installation construction costs: For certain industries, the BOI grants the right to deduct up to 25% of the project installation construction costs from net profits used for tax calculations. This deduction may be made within the first 10 years of the first revenue generated from the installed project
Non-tax incentives granted by the BOI:
- Permit for foreign nationals to enter the Kingdom for the purpose of studying investment opportunities: the BOI may grant foreigners the right to stay and work in Thailand for the purpose of investment feasibility studies
- Permit to bring into the Kingdom skilled workers and experts to work in investment promoted activities: A promotion by the BOI reduces minimum capital requirements and foreigners to thai workers ratio requirements.
- Permit to own land
- Permit to take out or remit money abroad in foreign currency
Guarantees: A promotion by the BOI also enables the promoted company to the following guarantees from the Kingdom of Thailand:
- The State will not nationalize the activity of the promoted person
- The State will not undertake a new activity in competition with the promoted persons or companies
- The State will not monopolize the sale of products similar to the promoted persons or companies
- The State will not impose price controls on the products of the promoted persons or companies
- The state will grant permission to export at all times
- The state will not allow any government agency, government organization or state enterprise to import any kind of the product being produced by the promoted person into the Kingdom by granting import duty exemption