Thailand’s government has legally provided a VAT exemption for cryptocurrency transfers made through government-approved exchanges. The tax discount will apply to digital money issued by the Bank of Thailand until the end of next year. In Thailand, investors who move cryptocurrencies and digital tokens through exchanges will benefit from a 7% VAT exemption on such transactions.
The tax relief is retroactive to April 1, 2022, according to a decree published in the Royal Gazette on Tuesday. According to local media, it will stay in effect until December 31, 2023. The government approved the policy in March, and it applies to trading platforms that are registered with the Ministry of Finance. The judgment is now part of Thai law, as it takes effect the day after it is published in the official journal.
The major goal of the tax exemption, according to the paper, is to promote cryptocurrency trading on recognized exchanges, allowing crypto transactions to be controlled and monitored by appropriate authorities such as the Securities and Exchange Commission (SEC). Thailand’s Finance Minister, Arkom Termpittayapaisit, is certain that the country’s cryptocurrency exchange would become more dependable and stable as tax restrictions are loosened.
Ekniti Nititthanprapas, Director-General of the Revenue Department, stated that crypto trading will be easier for investors, who will benefit from fair tax treatment and secure transactions while Thailand’s reputation in the global digital realm improves. Another royal decree also announced on May 24, extends the VAT exemption to transfers using Thailand’s monetary authority’s retail central bank digital currency (CBDC).
The Bank of Thailand said in December that it plans to begin testing the CBDC as an alternative payment method in late 2022 in transactions between financial institutions and customers. Thailand has seen a substantial increase in cryptocurrency investment and trade in recent years. The country’s financial regulators took efforts to prohibit the use of cryptocurrencies for payments in late March, citing the need to avert different financial and economic concerns. The SEC announced guidelines meant to deter digital asset operators from offering such services.