BoI offers more tax exemption
IN ANOTHER bid to boost the economy, the Board of Investment (BoI) has increased corporate income tax exemptions by up to two years for investment projects that can begin operations by the end of 2017.
At a meeting yesterday chaired by Prime Minister General Prayut Chan-o-cha, the BoI also resolved to introduce measures to promote industrial clusters to boost the competitiveness of key industries and attract new investments.
Hiranya Sujinai, secretary-general of the BoI, said the investment board agreed to introduce measures to hasten investment projects and stimulate economic growth by offering additional tax exemptions to investors who submitted projects between January 1, 2015 to December 31, 2016 and can commence production or service provisioning by the end of 2017. Hiranya said the measures approved by the BoI yesterday could be implemented shortly and could be adjusted when the new BoI law comes into effect.
On Tuesday, the Cabinet approved a plan to amend the BoI law to allow the investment board to increase its corporate income tax exemption to 13 years, up from eight years.
The entitled projects comprise two groups.
The first includes projects that are located in Special Economic Zones (SEZs). They will receive corporate income tax exemptions for two years longer than they would have been entitled to under the current rates but not exceeding eight years. For projects that are already entitled eight years tax exemption will receive half of the corporate tax reduction for the following five years.
The second group includes projects situated outside the SEZs, which will receive one additional year of corporate tax exemption but not exceeding the eight years maximum cap according to the current.
Industry Minister Atchaka Sriboonruang said the BoI also agreed to introduce measures to promote industrial clusters in a bid to enhance the competitiveness of industries, promote their links with educational and research institutes, and attract more investments.
At the initial phase, six industrial clusters will be entitled to the extra investment privileges. These include four “Super Clusters” of high-technology industry and industries of the future: automobile and parts; electrical appliances and telecom equipment; environmentally-friendly petrochemicals and chemicals; and digital or ICT (information, communication and telecommunication).
The projects must be located in one of nine provinces: Nakhon Ratchasima, Ayutthaya, Prachin Buri, Chachoengsao, Rayong, Chiang Mai, Phuket, Chon Buri and Pathum Thani.
The other two targeted clusters are processed agriculture and textile and garments, which can be situated in any of the five regions: North, Northeast, Central, East, West and South.
Atchaka said the cluster-based projects would receive extra tax incentives, higher than the normal rates agreed by the Ministry of Finance.
The package would have to be approved by the Cabinet since they will include Boi and non-BoI incentives such as the extra tax privileges, the educational and research institutes’ linkage measures, and the Transport Ministry’s role to adjust its transport plan to support clusters development.
The BoI also yesterday approved to grant investment privileges for 17 projects with a total investment value of more than Bt78 billion.
These include eight agro-industry projects by firms such as Charoen Pokphand Food, Intec Feed, Betagro, Panel Plus MDF, and TOTO; three projects in the metal and automotive industries by Ford Motor Co, AED Fabrication and Century Tyres; and six projects in the power generation and airlines industries.
