Thailand’s New Tax Measure to Boost Crypto Market
Thailand has recently made a significant move in the world of digital assets by announcing a five-year exemption on capital gains tax for crypto transactions. This new tax measure is aimed at positioning the country as a global digital asset hub and boosting tax revenue in the process.
Deputy Finance Minister Julapun Amornvivat revealed that the Ministry of Finance has approved this tax reform, which will exempt personal income tax on capital gains from the sale of digital assets made through licensed digital asset businesses. This includes exchanges, brokers, and dealers operating under the 2018 Royal Decree on Digital Asset Businesses. The exemption will be in effect from January 1, 2025, to December 31, 2029.
The main goal behind this tax exemption is to stimulate the domestic digital asset market and related sectors, ultimately contributing to economic growth. The government estimates that this measure will generate at least 1 billion baht in medium-term tax revenue.
Julapun emphasized that this tax reform promotes transparent and traceable digital asset trading through entities regulated by the Anti-Money Laundering Office, in alignment with international standards set by the Financial Action Task Force. Additionally, Thailand’s Revenue Department is working on adopting the OECD’s system for automatically sharing digital asset information with other countries, enhancing transaction transparency.
This tax reform comes on the heels of Thailand’s recent regulatory crackdown, which resulted in the blocking of several global crypto exchanges due to the lack of local licenses. However, crypto exchange KuCoin has chosen to take a compliant route by launching a fully regulated local subsidiary in Thailand after securing an SEC license. This move positions KuCoin among a competitive field of eight other licensed exchanges in the country.
Thailand’s crypto sector has been thriving, fueled by progressive regulation and growing adoption. The recent pilot program allowing tourists to make payments with crypto is a testament to the country’s embrace of digital assets.
By exempting capital gains on crypto income, Thailand joins a select group of offshore jurisdictions that do not levy capital gains tax on cryptocurrency. Countries like Singapore, Malaysia, and the United Arab Emirates also provide capital gains tax exemptions for individual crypto investors. In Europe, residents of countries like Germany and Portugal can avoid paying capital gains tax altogether by holding their cryptocurrencies for over a year.
Overall, Thailand’s new tax measure is poised to make a significant impact on the country’s digital asset landscape, attracting investors and positioning Thailand as a key player in the global crypto market.