According to the data collected by the Thailand Board of Investment (BOI), within the first nine months of 2020, local and international companies invested 1.7 billion USD in Thailand, over more than 300 projects listed as BCG or Bio-Circular-Green economic activities.
A key factor driving this success is Thailand’s numerous tax cuts offered to companies engaged in green and sustainable industries. Besides, there are also non-tax incentives, such as renewable smart visas, allowing international talents and investors to work and stay in Thailand for up to four years.
As defined by the Thai government, the BCG model integrates bioeconomy, circular economy, and green economy. It encompasses industries that allow inclusive and sustainable growth, namely agriculture and food, tourism, bioenergy, biomaterials and biochemicals, medical and wellness, among others. By 2025, Thailand’s government aims to make BCG industries responsible for 25% of the national GDP.
Recently, the South East Asian nation also issued an additional stimulus package to accelerate investments, such as corporate income tax (CIT) deductions for large-scale projects and for businesses seeking to adopt digital technologies in their operations.
Accordingly, projects in selected industries with investments worth at least THB 1 billion (USD 33 million) will be eligible for a CIT deduction of 50% on profits generated from existing BOI projects for a period of five years. Eligible projects need to apply between January 4, 2021, to December 30, 2021. Businesses that are in the process of adopting digital technology (i.e., software integration, artificial intelligence, big data analytics) in their operations can also benefit from a 50% CIT exemption on profits for an additional three years. Eligible projects need to apply by the end of 2022.
(Sources: BOI, Bangkok Post, Dezan Shira & Associates)