Tax Flood Relief Measures for BOI Promoted Companies - Mazars - Thailand
Tax Flood Relief Measures for BOI Promoted Companies
The Cabinet has approved tax relief measures for Board of Investment (‘BOI’) promoted companies that have been affected by the flooding.
13/12/2011
Keywords: Tax, Thailand, BOI, Flooding, Tax Holiday
The following tax measures for BOI promoted companies have been approved by Cabinet, but are still to be passed into law.
Flood affected companies that wish to establish a temporary production facility or make a new investment in Thailand.
For companies investing in a province affected by the floods the following incentives are being proposed:
| BOI Zone | Industrial Estate | Income Tax Holiday |
Income Tax Reduction After Tax Holiday |
| Zone 1 | Inside/ Outside | 8 years without cap | - |
| Zone 2 | Inside | 8 years without cap |
50% reduction of tax for a further 3 years |
| Outside | 8 years without cap | - | |
| Zone 3 | Inside/ Outside and Special | 8 years without cap |
50% reduction of tax for a further 5 years |
For BOI promoted companies investing in another non- flood affected province, the amount of tax exempted will be capped.
New investors or any investor not affected by the floods who wishes to undertake a new investment or expand its existing business in Thailand
The following income tax concessions will apply:
| BOI Zone | Industrial Estate | Income Tax Holiday |
Income Tax Reduction After Tax Holiday |
| Zone 1 | Inside | 8 years cap |
50% reduction for another 3 years |
| Outside | 8 years cap | - | |
| Zone 2 | Inside | 8 years cap |
50% reduction for another 5 years |
| Outside | 8 years cap | - | |
| Zone 3 | Inside/ Outside and Special | 8 years cap | 50% reduction for another 5 years |
Approval Process
There are still a few issues that need to be ironed out before the incentives proposed above are passed into law. The Cabinet decision grants generous incentives for existing companies to invest in a province affected by flooding. However, some parts of that province may not have been affected at all whilst other regions will have been inundated with water. Likewise it appears a little inequitable that a new company investing in an industrial estate in Zone 2 for instance will be entitled to a 5 year 50% income tax reduction after the 8 year holiday but an existing company affected by flooding will only be entitled to a 3 year concession.
Source: http://www.eppo.go.th/admin/cab/cab-2554-10-25.html#14
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