Thailand has launched a new tax amnesty scheme designed to encourage small- and medium-sized businesses to move from the informal economy and register for income tax.
Under the program, which commenced on January 1, 2016, eligible SMEs will be exempt from corporate tax for 2016 and will pay half the regular 20 percent corporate tax rate for the subsequent year. In addition, qualifying firms will not be subject to prior year tax investigations by the tax authority.
To qualify for the reduced tax rates, companies must have had revenues of less than THB30m (USD830,000) in the 2015 accounting year. The company’s registered capital also must not exceed THB5m.
In another measure aimed at shrinking the size of the informal economy, banks have been forbidden from lending to companies which have not signed up for a tax account with the tax authority.
It is said that around 350,000 SMEs in Thailand meet the eligibility criteria for the amnesty, and the Government expects to collect an extra THB5bn per year from SMEs following the conclusion of the scheme.
