The Board of Investment (BOI) has approved fresh “Thailand Plus” incentives to help convince foreign businesses to relocate to Thailand.
They’ll be offered benefits including an additional 50-per-cent reduction in corporate income tax for five years, double the allowance for training expenses and a five-year corporate tax exemption for establishing skills development institutions.
BOI secretary-general Duangjai Asawachintachit said on Friday (September 20) after a board meeting chaired by Prime Minister Prayut Chan-o-cha that the board agreed with the measures endorsed by economic ministers on September 6.
The package features means to accelerate foreign investment and expedite large-scale projects in targeted industries.
An additional 50 per cent reduction in corporate income tax for five years will be offered to corporations located outside Bangkok that are eligible for five- to eight-year tax exemptions.
Applications must be submitted to the BOI by the end of 2020 and actual investment must be at least Bt1 billion, expedited within 2021.
To develop human resources and build up the high-skilled workforce, companies are encouraged to provide training and engage in the education of the future workforce before it enters the employment market.
They are also to be encouraged to establish professional training and educational institutions in science, technology and engineering (STEM).
Investment or expenses related to human resource development can be included in the allowance for corporate tax exemption with no minimum expense condition. Two categories of investment in HR development can benefit from these measures.
Category 1: Corporates will receive additional corporate tax exemption allowance of one time the actual expenses or investment in STEM training of students in Dual Education, Cooperative Education or Work-Integrated Learning programs.
Category 2: Corporates will receive additional corporate tax exemption allowance of two times the actual expenses or investment in providing employee training related to targeted technologies. The training courses must be endorsed by the Ministry of Higher Education, Science, Research and Innovation, or the Easter Economic Corridor Policy Committee for training institutions in EEC.
Applications for these additional incentives must be submitted by the year 2021 and before the end of the project’s corporate tax exemption period.
Parent companies investing in the establishment of training institutions endorsed by the Ministry of Education will be eligible for a five-year corporate tax exemption for all of the invested funding. Newly established institutions will receive import tax exemption for machinery needed.
Applications must be submitted by 2021 and applicants must be in sectors under the BOI’s current investment promotion scheme.
The BOI meanwhile approved Songkhla’s Chana district as Thailand’s fourth model city, aiming to create cross-border economic links with Malaysia and Singapore and support industrial development in the South.
Investors in Chana will receive the same incentives applied in the three other model cities – Nong Chik in Pattani, Betong in Yala and Su-ngai Kolok in Narathiwat.
These include an eight-year corporate tax exemption for new projects and a five-year exemption for existing projects, and other privileges such as a 90-per-cent reduction in normal import tax for 10 years for raw materials or materials needed for manufacturing products for the domestic market.