Thailand’s Revenue Department Introduces New Tax Policy
Thailand’s Revenue Department has announced its plans to impose personal income tax on the foreign earnings of residents. The new tax policy targets specific groups, including crypto traders who spend up to 180 days a year in the country.
Review of Thailand’s Revenue Code
The Bangkok Post reported that the Revenue Department reviewed a section of Thailand’s Revenue Code. The updated rule states that individuals who live in Thailand for at least 180 days a year and earn foreign income from work or assets will be subject to personal income tax.
Targets of the New Tax Policy
Legal experts believe that this new policy specifically targets three groups: Thailand residents participating in foreign stock markets through foreign brokerages, crypto traders, and those exploiting the current taxation system.
The previous rule only taxed residents with overseas earnings if the money was remitted into Thailand in the same year it was earned. However, the new tax policy aims to close the loophole of deferring the transfer of foreign income to a different year.
Effective Date and Reporting
This new tax policy will go into effect on January 1, 2024. Residents and those with overseas earnings are expected to report their income in 2025.
Taxing Earnings from Overseas Crypto Trading
With limited trading pairs and volume on local exchanges like Bitkub, many Thai crypto traders likely use offshore exchanges. It remains unclear how the Revenue Department plans to tax earnings from overseas crypto trading.
Potential Funding for a National Airdrop
The introduction of this tax policy follows Srettha Thavisin becoming Thailand’s Prime Minister. Thavisin campaigned on promises of economic relief, including a national “airdrop.” This airdrop would give 10,000 baht (approximately $300) to every Thai citizen above 16 years old in the form of a national token.
Reports suggest that the new tax policy could be a way to fund the planned nationwide stimulus, which is estimated to cost around 560 billion baht ($15.7 billion).
Criticism and Income Disparity
The new tax rule has faced criticism due to concerns that it may worsen Thailand’s existing income disparity.
Hot Take: Thailand Implements Personal Income Tax on Foreign Earnings
Thailand’s Revenue Department has adjusted its tax policy to include personal income tax on foreign earnings of residents. This change affects various groups, including crypto traders who spend up to 180 days in Thailand. The new rule aims to close loopholes and ensure that individuals pay taxes on their foreign income regardless of when it is earned. However, the impact on taxing overseas crypto trading remains uncertain. The introduction of this tax policy aligns with the government’s plans for a national “airdrop” as a form of economic relief. Critics argue that this new tax rule may exacerbate income inequality in Thailand.
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