Tax incentives for the sale of gold bars

In November 2017, the Thai government approved draft laws that reduce and exempt taxes for the sale of gold bars under a forward contract.

Keywords: Mazars, Thailand, Tax, Gold, Withholding Tax, Royal Gazette, VAT

12 December 2017

We set below a summary of those draft laws.

1. Capital gains from the sale of gold bars, the purity of which is 99.99%, under a forward contract that was made in accordance with the law governing forward contracts and in the Thailand Futures Exchange, shall be subject to income tax at a fixed rate of 15%. The conditions of the tax benefit are that the income earner shall allow the payer to deduct the 15% withholding tax from the payment of those gains, and that this withholding tax shall be treated as a final tax. Accordingly, the income earner shall not have to declare those gains as taxable income when filing a tax return.

2. Compensation received due to the postponement of the delivery of gold bars, the purity of which is 99.99%, under a forward contract that was made in accordance with the law governing forward contracts and in the Thailand Futures Exchange, shall be subject to income tax at a fixed rate of 15%. The conditions of the tax benefit are that the income earner shall allow the payer to deduct the 15% withholding tax from the payment of that compensation, and that this withholding tax shall be treated as a final tax. Accordingly, the income earner shall not have to declare that compensation as taxable income when filing a tax return.

3. The sale of gold bars, the purity of which is 99.99% and which is not made into ornamental gold, under a forward contract that was made in accordance with the law governing forward contracts and in the Thailand Futures Exchange, shall be exempt from VAT. 

4. The tax benefits set out above shall become effective on the date following that on which the law is published in the Royal Gazette. 

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