Thailand revamps investment policy

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Board of Investment ThailandThailand’s Board of Investment (BOI) has announced it will introduce major changes to its investment incentive policy as the country is preparing for the Asean Economic Community slated to come into effect at the beginning of 2016.

The BOI said it has identified “problems with Thailand’s current economic path” which include low competitiveness, low investment in research and development, growing labour shortages for both skilled and unskilled workers,  increasing restrictions on heavy industries, as well as potential problems in energy security.

A new incentive programme — called “Thailand 4.0” — is aimed at helping Thailand become a high-value economy and a regional hub, the BOI said. Key ingredients include more research and development, a focus on services and high-value industries, better care for the environment and cross-border regional clusters.

The BOI also plans to scrap the current emphasis on geographic zones which are to be replaced by new regional clusters that promote a concentration of investment plus one-stop services. There would also be a strong emphasis on border areas, with companies based in Thailand encouraged to build cross-border supply chains and develop regional clusters with its neighbours.

Incentives would be gradually phased out for heavy industries, low-value-added industries, factories that cause environmental problems or consume a lot of energy and and concession and monopoly industries such as telecoms and concession roads.

Investments in the service sector and research and development would be given preferential treatment by the BoI, especially in high priority sectors such as hospitality and healthcare, creative economy, green industry and alternative energy.

However, Thai and foreign investors have expressed concern about the loss of promotional privileges such as tax incentives for economic zones, and individual businesses said they are worried about the loss of tax benefits in certain industries such as hydroponic farming, reforestation and long-stay tourism.

The BOI has not yet announced when the changes will come into effect.

 

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Reading Time: 2 minutes

Thailand’s Board of Investment (BOI) has announced it will introduce major changes to its investment incentive policy as the country is preparing for the Asean Economic Community slated to come into effect at the beginning of 2016.

Reading Time: 2 minutes

Board of Investment ThailandThailand’s Board of Investment (BOI) has announced it will introduce major changes to its investment incentive policy as the country is preparing for the Asean Economic Community slated to come into effect at the beginning of 2016.

The BOI said it has identified “problems with Thailand’s current economic path” which include low competitiveness, low investment in research and development, growing labour shortages for both skilled and unskilled workers,  increasing restrictions on heavy industries, as well as potential problems in energy security.

A new incentive programme — called “Thailand 4.0” — is aimed at helping Thailand become a high-value economy and a regional hub, the BOI said. Key ingredients include more research and development, a focus on services and high-value industries, better care for the environment and cross-border regional clusters.

The BOI also plans to scrap the current emphasis on geographic zones which are to be replaced by new regional clusters that promote a concentration of investment plus one-stop services. There would also be a strong emphasis on border areas, with companies based in Thailand encouraged to build cross-border supply chains and develop regional clusters with its neighbours.

Incentives would be gradually phased out for heavy industries, low-value-added industries, factories that cause environmental problems or consume a lot of energy and and concession and monopoly industries such as telecoms and concession roads.

Investments in the service sector and research and development would be given preferential treatment by the BoI, especially in high priority sectors such as hospitality and healthcare, creative economy, green industry and alternative energy.

However, Thai and foreign investors have expressed concern about the loss of promotional privileges such as tax incentives for economic zones, and individual businesses said they are worried about the loss of tax benefits in certain industries such as hydroponic farming, reforestation and long-stay tourism.

The BOI has not yet announced when the changes will come into effect.

 

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