Thailand Greenlights Relaxed Tax Rules for Cryptocurrencies
The Thai finance ministry has reportedly eased crypto tax regulations in the country in a bid to encourage investment in the emerging asset class, Reuters reports, March 8, 2022.
Thailand to Ease Crypto Tax?
Today, Thailand’s cabinet announced a relaxation in tax rules for investment in digital assets in a move that is widely being seen as an attempt to promote and develop the emerging industry following record-breaking interest in crypto trading in the country.
The new rules, once they come into effect, will enable traders to offset annual losses against gains for taxes due on digital assets investments. In addition, they will exempt a value-added tax of 7 percent for cryptocurrency trading on authorized crypto trading platforms, Thailand’s Finance Minister, Arkhom Termpittayapaisith told a news conference.
Notably, the tax exemption is slated to come into effect from April 2022 until December 2023 and will cover the trading of retail central bank digital currency (CBDC) that is likely to be issued by the Thai central bank later this year.
It is worthy of note that the popularity of digital assets has soared unlike ever before in Thailand over the past year. Specifically, the total number of crypto trading accounts skyrocketed to about 2 million at the end of 2021 from just around 170,000 earlier in the year.
Notably, bitcoin (BTC) is the most popular cryptocurrency in Thailand which hardly comes as a surprise given the command BTC holds in the overall digital assets market.
Besides the relaxation in tax rules, the Thai finance ministry has also approved tax breaks for direct and indirect investments in start-ups. Notably, investors who invest for a minimum of two years in start-ups will be offered a tax break for 10 years until June 2032.
Crypto Regulations in Southeast Asia
While Thailand is reportedly mulling easing crypto tax regulations in the country, things aren’t as encouraging in the neighboring country India where crypto investors and traders are poised to be hit by a 30 percent flat tax rate on all profits.
crypto.news reported on February 1 how India is set to implement a 30 percent capital gains tax on bitcoin (BTC) and other cryptocurrencies being traded on Indian exchanges. At the time, the Indian finance minister said:
“There has been a phenomenal increase in transactions in virtual digital assets. The magnitude and frequency of these transactions have made it imperative to provide for a tax regime.”
Adding:
“We have circulated a paper, inputs are coming in, public stakeholders are coming in so regulation goes through that process. I don’t wait till regulation comes into place taxing people who are earning profits. Can I?”
Similarly, in October last year, the Malaysian financial watchdog announced a revision of its IEO and DAC guidelines to establish a more conducive and secure regulatory environment for digital asset traders in the country.
It should also be recalled that in April last year, the Singaporean tax watchdog – The Internal Revenue Authority of Singapore (IRAS) – had published new guidelines indicating a tax exemption for hard forks and airdrops.
