Thailand Approves Tax Breaks for Investment Token Holders

Thailand has taken significant steps to bolster its cryptocurrency and token economy, aiming to position itself as a hub for investment and capital mobilization. The Thai government recently approved tax measures to promote fundraising through investment tokens, signaling its commitment to fostering innovation and economic growth in the digital asset sector.

The latest tax break approved by Thailand’s cabinet targets individuals holding investment tokens. According to the Director-General of Thailand’s Revenue Department, Kulaya Tantitemit, individuals who earn profits from holding investment tokens and have had a 15% withholding tax deducted can now exclude this income when calculating their personal income tax. This move is part of the government’s efforts to eliminate double taxation and incentivize investment in digital assets.

Moreover, the tax exemption for investment token earnings is retroactively effective from January 1, 2024, providing clarity and support for investors in the crypto space. By encouraging the use of investment tokens for fundraising, Thailand aims to enhance its competitiveness as a destination for capital mobilization and business innovation.

In addition to tax breaks for individual token holders, the Thai government has introduced incentives for investment token issuers. Corporate income tax and value-added tax (VAT) for investment token issuers have been waived, offering businesses an alternative fundraising avenue and facilitating access to capital markets.

Thailand’s journey with crypto taxation has been marked by regulatory evolution and responsiveness to market dynamics. In January 2022, the country introduced a 15% capital gains tax on crypto traders, only to suspend its implementation in the face of public opposition. Subsequent revisions to tax policies, including exemptions for traders on authorized exchanges from a 7% VAT on crypto, demonstrate Thailand’s agility in adapting its regulatory framework to support the growth of the crypto ecosystem.

Looking ahead, the Thai government’s focus on promoting investment tokens and facilitating capital mobilization is expected to have far-reaching implications for the country’s economy. The Securities and Exchange Commission anticipates significant capital mobilization through investment tokens, with projections reaching 18.5 billion baht this year.

Photo by Oleksandr P