Thailand’s cabinet eased tax regulations on Tuesday for investments in Bitcoin and other cryptocurrencies in order to fully develop the second-largest growing economy in Southeast Asia, according to an official press release.
A 7% VAT for authorized exchanges, as well as the ability to offset one’s annual losses for taxes due to bitcoin and other cryptocurrencies aims to help incentivize further trading and investment strategies in the fast-growing economy.
“This issue will allow Thai investors to trade digital assets on a reliable Thai exchange,” said Finance Minister Arkhom Termpittayapaisith, per a translated version of the release. “Because it is under the supervision of the SEC and other related government agencies, it enables Thailand to have a future payment infrastructure ready for the digital economy.”
The tax exemptions provided through this initiative will be effective from April 2022 to December 2023, and will include the impending central bank digital currency (CBDC) that Thailand intends to offer, the minister said.
Direct and indirect investments in startups will also be eligible for tax breaks, as investors who invest for at least two years in a startup will be offered tax breaks for 10 years, until June 2032, Termpittayapaisith said.
“This will help support Thai startups to raise more capital from investors and strengthen domestic investment. This will enable the economy to expand sustainably and enhance the country’s competitiveness,” he said.
Termpittayapaisith explained that digital asset trading relief “will help investors in digital assets to be comfortable in performing their legal duties and get fairer in paying more taxes.” He continued to explain the benefits of this relief, including “help investors trade digital assets that take place on Thai exchanges to be reliable, safe, and give people the option to use cryptocurrencies in the future.”