According to a Royal Decree published on the Royal Gazette website in Thailand, no VAT will be applicable on the transfer of crypto or digital tokens on digital asset exchanges.
The law applies to transactions made since April 1, 2022 on trading platforms that are registered with the Ministry of Finance. The previously levied 7% VAT will not be applicable until December 31, 2023.
According to another decree issued the same day, VAT will not be charged on transfers of the country’s digital currency or CBDC from the Bank of Thailand for public usage.
The measure was approved by the government in March and has now become a part of Thai law, following its publication in the official journal.
According to the document, the major goal of the tax exemption is widespread adoption of crypto trading on authorised exchanges.
This will allow crypto transactions to be monitored and controlled by appropriate authorities such as the Securities and Exchange Commission (SEC).
Arkhom Termpittayapaisith, the finance minister of Thailand has said, “This would encourage Thailand to have an infrastructure and payment system that would be ready for the future digital economy.”
The Director-General of the Revenue Department, Ekniti Nititthanprapas added that this will make crypto trading more convenient for investors by the virtue of fair tax treatment and safe transactions.
It will also allow Thailand to develop a “good image” in the global digital economy.
The crypto market has grown and developed in Thailand over the last few years. However, in March, the Securities and Exchange Commission and the Bank of Thailand banned the use of crypto as a means of payments for goods and services. The primary reason cited for this decision was the risk of loss of stability of the payment system.