Thai Government's Tax Reductions to Stimulate Business Investment in Thailand

Prominent Thai law firm BSA Law applauds the government of Thailand for its move to deuce the corporate tax rate in 2013 and 2014, brightening prospects for economic growth and foreign direct business investment in Thailand. BSA Law forecasts that Thai business law services and tax consulting in Thailand will grow along with foreign investment. End Quote

(1888PressRelease) November 08, 2012 - Bangkok - Prominent Thai law firm BSA Law applauds Thailand's cabinet for approving the measure of reducing the corporate tax as a means to further stimulating economic growth and business investment in Thailand.

The tax cut, to 23 per cent in 2013 from 30 per cent previously, will help improve Thailand's status as a haven for foreign investment in South East Asia and add to an already rapidly growing level of foreign business investment in Thailand. The tax will decline further in 2014 to 20 per cent, according to the Cabinet decision.

"Thailand's economy has been recovering at a rapid pace this year, with growth expected at as fast as 6.2 per cent on year in 2012 at a time when much of the world is registering slow growth or is even in recession," BSA spokesman Apisakde Kongkangwanchoke said. "The tax reduction approved by the Cabinet is likely to further boost growth and may even encourage more complete reporting of taxes, easing the job of tax consulting in Thailand. In essence, this reduction may help the economy while actually increasing the overall amount of taxes the government is to receive."

Under the new tax regulations, companies that are currently listed on the stock exchange pay a tax rate of 25 per cent, although that will fall to the same level as other companies - 23 per cent - as of next year, and to 20 per cent in 2014.

Currently, small firms are exempt from tax if they post profit of less than 5 million Thai baht. Profit of as much as 1 billion baht is taxable with 15 per cent, and profit up to 3 million baht faces a tax of 25 per cent. The current tax level of 30 per cent applies to companies that post profit above the 3 million baht level. Seeking effective Thai business law services will help investors further understand how taxes may affect their business investment in Thailand.

Foreign direct business investment in Thailand, which has risen a surprisingly rapid 66.5 per cent in the first half of this year compared with the same period of last year, has already shown positive effects on the economy. The tax reductions approved by Cabinet this year will likely enhance that, providing even greater opportunities for foreign business investment in Thailand.

The government of Thailand has estimated the corporate tax cuts will cost it 52.5 billion baht in the current fiscal year, which started in October. However, BSA Law believes the loss may turn into a gain as the tax draws increased Thai business investment from foreign companies.

The reductions give Thailand the second lowest corporate tax rate in the Association of Southeast Asian Nations, significantly raising the profile of Thailand as an attractive destination for foreign investment, according to BSA Law, which has served the Thai and the foreign business communities for almost 30 years.

Mr. Kongkangwanchoke pointed out that the increasing foreign business investment in Thailand is prompting rising interest in Thai business law, Thai visa services, tax consulting in Thailand and other services. Thai law firm BSA Law, then, would like to advise prospective foreign investors to seek professional tax consulting in Thailand before making any concrete plans in relation to tax payments for a business investment in Thailand.

About BSA Law:
For nearly 30 years, Bamrung Suvicha Apisakdi Law Associates (BSA Law) has focused on providing reliable legal advice and services to the Thai and foreign business community in Thailand. BSA Law seeks to provide international standards of legal services while retaining the customs of the Thai business culture.

For more information please contact:

Jim Byrne
Business Advisor, BSA Law.
Email: jim ( @ ) bsalaw dot co dot th
http://www.bsalaw.co.th

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