|Prisna Sungwanna||Supattra Sathapornnanon|
Activity-based incentives are divided into Group A and Group B, as indicated in the new list. Group A activities receive corporate income tax incentives, machinery and raw materials import duty incentive,s and other non-tax incentives. Group A is divided into four subgroups. Group B activities receive only machinery and raw material import duty incentives and other non-tax incentives. Group B is divided into two subgroups.
Merit-based incentives are described in section 9.2 of the Announcement, under the following categories: merit on competitiveness enhancement (six classes of projects are specified); merit on decentralisation, being projects located in investment promotion zones (20 provinces with low per capital income).; and merit on industrial area development (projects located within industrial estates or promoted industrial zones).
Projects with activities in Group A and Group B can apply for merit-based incentives at the time of applying for investment promotion (and in the case of Group A, after being promoted). Group A projects are granted the following activity-based tax incentives: three, five or eight -year corporate income tax exemptions; exemption of import duties on machinery; and reduction of import duties for raw and essential materials for use in production for export for one year, which may be extended.
Additional merit-based tax incentives may include: 50% reduction of corporate income tax after initial tax holiday; double deductions from the costs of transportation, electricity and water supply; and additional 25% deduction of the cost of installation or construction of facilities.
Both Group A and Group B activities are given the following non-tax incentives: permit for foreigners to enter Thailand to study an investment opportunity or work; permit to own land; and permit to bring in and take out money in foreign currency.
The Announcement is only applicable to applications submitted after January 1 2015 (section 13). For more information, see BOI website www.boi.go.th.
Prisna Sungwanna and Supattra Sathapornnanon