Tax cuts with a twist: SEZ businesses get a decade of ten-percenters
The Revenue Department is slashing corporate income tax to just 10% for businesses nestled in Thailand’s special economic zones (SEZs) for the next ten years in a stunning financial manoeuvre. The move, designed to inject life into these strategically positioned areas, is set to give them a major boost.
Director General Pinsai Suraswadi revealed that this game-changing tax cut received Cabinet approval on Monday, January 13, swiftly followed by a royal decree to solidify its enforcement in SEZs.
“The Finance Ministry, through the Revenue Department, has been bent on drumming up investment for SEZs.”
A draft royal decree was submitted to finesse the efficiency of tax measures promoting SEZ investment.
The newly announced measure slashes the typical 20% corporate income tax rate to a mere 10% of net profit. This perk applies to companies or juristic partnerships whose operations are aligned with industries recognised by the SEZ Policy Committee, regardless of their headquarters’ location.
The tax break applies for ten whole accounting years, covering income from goods churned out within SEZs or their specific services.
Pinsai beamed about the initiative’s potential to ramp up production, service provision, and employment within these zones. The tax cut is poised to solidify ties between SEZ activities and key economic areas, as well as bolster border economic ties, thereby sharpening Thailand’s competitive edge.
The ten SEZs—including Tak, Mukdahan, Sa Kaeo, Songkhla, Trat, Nong Khai, Narathiwat, Chiang Rai, Nakhon Phanom, and Kanchanaburi—are dotted along crucial border regions.
Established back in 2015 to spur economic growth, particularly in border areas, these zones have been strategically crafted to up trade and investment opportunities with neighbouring nations, aiming to bridge regional economic gaps and foster local development, reported Bangkok Post.
In related finance news, the Thai government officially confirmed that elderly citizens will receive their long-awaited 10,000 baht stimulus payments before January 29. Deputy Finance Minister Julapun Amornvivat, spilled the beans during a press conference at the Ministry of Finance on January 7.
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