Thai govt prepares new incentive package to woo investors to EEC
Huge tax breaks and other incentives to be offered in bid to boost investment in targeted industries in the EEC region
The government is preparing a new set of privileges, including exempting corporate tax for 15 years, to draw more investors in targeted industries to the Eastern Economic Corridor (EEC).
Commerce Minister Phumtham Wechayachai, who is also deputy prime minister, said on Wednesday that he will soon hold a meeting with the EEC policy board to endorse the new privilege package before sending it to the Cabinet for approval.
Phumtham has been assigned by Prime Minister Srettha Thavisin to chair the meeting.
The commerce minister said the board will soon consider approving more investments to improve the EEC infrastructure.
Chula Sukmanop, the EEC Office secretary-general, said that if the Cabinet approves the new privilege package, then more foreign investors would apply for it and invest in the EEC. He reckons investors will flock to Thailand within a few weeks of the announcement of the package.
Chula also said he was confident that the new package would encourage investors to spend on targeted industries in the EEC zone.
A source from the EEC Office said the package will cover tax and non-tax privileges, like being eligible for 1-15 years of corporate tax exemption based on the investment conditions.
Firms that are not eligible for this exemption, can still get a corporate tax deduction of 50% for 1 to 10 years provided they have invested in the EEC zones.
Companies eligible for corporate tax exemptions for no more than eight years can receive tax deductions for between one and five years once the exemption period expires.
In addition, once the exemption period is over, investors can cite accumulated losses of up to five years to seek tax deductions. They can also cite transport, power and water costs at twice the amount for calculating tax deductions.
The companies will also get the chance to deduct the cost of investment for convenience facilities from taxable income at the rate of 1-25% of the cost, the source added.
For non-tax privileges, investors of targeted industries can own land and condominium units without seeking special approval, and can bring specialists, executives and their families to live and work in Thailand without requiring a work permit.
The package will allow the investors to spend their foreign currency to buy goods and services without being subject to control by the Currencies Exchange Act.
The source added that firms investing in targeted EEC industries will also be eligible for support from the government’s competitiveness promotion fund.
Chula added that from January 1, 2023 to July 12, 2024, the EEC Office has successfully invited 109 investors to invest in the five targeted industries, namely medical and wellness, digital, modern automotive, the BCG (bio circular and green) economy and aviation and logistics.
