The Revenue Department has announced a reduction in the corporate income tax rate for businesses operating in special economic zones (SEZs) to 10% for a duration of 10 years, aimed at boosting investment in these areas.
Pinsai Suraswadi, the department’s director-general, revealed that the cabinet approved this tax reduction on January 13, and a royal decree has been issued to put this measure into effect.
According to Mr. Pinsai, the Finance Ministry, through the Revenue Department, has been actively promoting investments in SEZs and proposed this draft royal decree to improve the efficiency of tax incentives for these zones.
Under the new policy, the corporate income tax rate is set at 10% of net profits, down from the previous standard rate of 20%. This rate applies to companies or partnerships engaged in specific industries designated by the SEZ Policy Committee, regardless of where their headquarters are located.
The tax benefit will be available for income generated from the production of goods or provision of services within SEZs, for a continuous period of ten accounting years.
This initiative is expected to stimulate production, service delivery, and employment within the SEZs. Mr. Pinsai noted that the tax cut is anticipated to strengthen the link between production and service activities in SEZs and surrounding economic areas, thereby enhancing Thailand’s competitiveness.
There are currently 10 SEZs situated in border regions: Tak, Mukdahan, Sa Kaeo, Songkhla, Trat, Nong Khai, Narathiwat, Chiang Rai, Nakhon Phanom, and Kanchanaburi. Thailand established these SEZs in 2015 to encourage economic growth, particularly in border areas. These zones are strategically positioned to boost trade and investment opportunities with neighboring countries, with the goal of reducing regional economic disparities and promoting local development.