The Thailand Board of Investment (BOI) today approved a series of measures to promote and support local small and medium size enterprises (SME), especially in sectors facing high competition, and improved tax benefits for tourism businesses in second-tier provinces.
This package of measures approved today aims to encourage Thai entrepreneurs to improve their potential and efficiency, increase their competitiveness amid intense competition and global trade tensions resulting from the impact of the U.S. trade policies, and support the entrepreneurs involved in some of the most vulnerable sectors.
A key measure to support Thai entrepreneurs is an increase in the corporate income tax (CIT) benefits granted to BOI promoted SMEs which will now receive a 5-year CIT exemption equal to as much as 100% of their investment in enhancing their capabilities and improvements, up from the previous 3-year CIT exemption capped at 50% of investment.
Also, as part of the package approved today, the BOI will suspend the promotion of certain types of businesses, such as sectors that may face oversupply or may have a negative environmental impact. Sectors affected entirely or in part by the suspension include solar cell and solar panel manufacturing, certain vehicle parts manufacturing (such as lead-acid batteries, accessories, decorations and equipment for vehicles that do not affect driving performance and safety), coil centers, long steel production, hot rolled steel production, and steel pipes.
The consideration of new project applications will also involve an increased focus on the production process, in order to ensure that “essential production processes” are actually happening in the country, with the aim to promote value-added investment using modern technology in the manufacturing sector, and the development of the local supply chains.
The consideration of applications for investment promotion will include tighter criteria and screening regarding the hiring of foreign personnel, in terms of the appropriate proportion of Thai personnel for the manufacturing activities which hire more than 100 people and the foreign personnel’s minimum remuneration to promote investment that allows growth while promoting the development of the Thai workforce.
The meeting also approved measures to promote investment in tourism infrastructure businesses in the so-called 55 second-tier provinces. The measures are in line with the Government’s policy to upgrade tourism infrastructure and develop new tourist attractions to promote the distribution of tourists in less visited areas and to spread nationwide the economic benefits of tourism.
Investment in tourism businesses including large-scale quality tourist attractions, theme parks, Thai cultural centers, handicraft centers, museums, open zoos, international exhibition centers, large convention halls, cruise terminals, motor racing stadiums, cable cars and electric trams for tourism in the 55 designated provinces will receive 8 years CIT exemption privileges, increased from 5 years previously. Investments in hotel business in these provinces will receive 5 years CIT exemption, compared to the 3 years granted previously.
