BoI widening incentives for head-office relocation
The Board of Investment agreed yesterday to improve incentives for companies basing their regional operating headquarters (ROH) in Thailand.
Among the expanded incentives, the board has terminated corporate income tax, now charged at 20% on 50% of ROH revenues.
Under the new regime, ROHs would also be entitled to a corporate income tax exemption for 10 years on condition they spend at least 15 million baht a year or 150 million baht over 10 years and they have 3-5 foreign executives working in Thailand. After 10 years, ROHs will also be eligible for income tax exemption for another five years.
Atchaka Sibunruang, the secretary-general of the BoI, said the new regulations would also give ROHs three years to expand their regional activities to at least three countries, compared with one year previously.
The ROH programme was first introduced eight years ago. To date 81 companies have joined the programme.
The existing 81 ROHs will qualify for the new privileges but they needed to submit new applications to the BoI.An ROH is a juristic company incorporated in Thailand providing managerial, administrative and technical services as well as other supporting services to foreign branches or associated enterprises of a company.
Ms Atchaka said the Finance Ministry was also studying the possibility of extending the incentives to cover more activities such as trading houses and treasury-related services.
In a related development, the BoI yesterday also approved sustainable investment measures focusing mainly on energy preservation and alternative energy, environmentally friendly and high-technology industry.
Those industries could enjoy exemptions from machinery import duty and corporate income tax for eight years regardless of zone, except for Bangkok.
The BoI also reported the results of a survey of promoted projects about their plans over the next six months. It showed that 223 companies plan to hire more workers because of increased orders, especially for electronics and agribusiness, with 116 planning to expand investment this year for a total of 117.9 billion baht.
The board yesterday also approved three investment projects worth 14.48 billion baht.
