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ResourcesCorporate and Tax AdvisoryThailand Tax LawDiscussion of VAT and Digital Currencies in Thailand

Discussion of VAT and Digital Currencies in Thailand

Transcript of the above video:

In this video today we are going to be discussing as the title suggests, the value-added tax scheme here in Thailand and some recent developments with respect to value added tax and digital currencies.

In a recent article from Bangkok Post, the article was published March 15, 2018, the article's title is Digital Assets Trading Faces 7% VAT Levy”. Quoting directly, "Investors who make digital asset related trades will be liable for 7% value added tax on top of the 15% withholding tax on capital gains and returns from such investments when the new law is enforced but retail investors will be exempt from paying the VAT if they trade digital assets through exchanges"  said Finance Minister Apisak Tantivorawong. "It is unnecessary to enact an additional law to collect the VAT” he said “as the current law empowers the Revenue Department to do so".  As has been discussed in previous videos on this channel, Thai Authorities are at present working on methodology, well they are working on a regulatory scheme, regulatory structure if you will to deal with cryptocurrency, digital currency exchange thereof, exchange from ”digital currency” over to “real currency”. I don't mean to disdain one or the other, I guess physical “hard cash” I guess is the best way to look at it. So the thing to take away from this is, first of all it looks to me as though the relevant authorities especially the Revenue Department in Thailand, are taking the view that cryptocurrency is an asset and as such it is subject to not only capital gains but the transmission of such capital, the facilitation of such capital, is viewed as a I would assume, a service that can be that can have VAT assessed so you are looking at a VAT scheme now as well as a capital gains scheme now under the Thai Law and we're still waiting around to see exactly how the regulatory structure is going to be put into place by Thai SEC, the Securities and Exchange Commission with respect to things like initial coin offerings so stay tuned to this channel; we will update you when those come up. But the thing to take away from this video is clearly Thailand is doing what it can to come up with a legal apparatus for dealing with digital currencies and cryptocurrencies and sort of all the myriad issues that are associated therewith. We will update you as things change. Again the thing to take away from this video is you have got 7% VAT is going to be assessed and the other thing to take away is that it is clear that the Thai Revenue Department is going to be looking at cryptocurrency for purposes of taxation, tax collection, tax enforcement. All those things are going to become an issue for those here in the Kingdom and dealing with cryptocurrency issues.