Thailand’s value-added tax (VAT) will not apply to the transfer of virtual currencies or digital tokens until the end of the fiscal year 2023. Thursday, the exception will start to be used. It was written in a new royal decree issued under the Revenue Code for the VAT Exemption.
The latest royal order says that transactions involving cryptocurrencies and digital assets that happen on licensed digital asset exchanges will not be taxed until the end of 2023. The minister of finance is in charge of both how and when the order is carried out.
The Thai government has made it possible for government-licensed cryptocurrency exchanges to not charge value-added tax (VAT). The fact that they don’t pay taxes will last until the end of next year. The digital money from the Bank of Thailand will also be shown.
When investors in Thailand buy cryptocurrencies and digital tokens through exchanges, they won’t have to pay the 7 percent VAT that is usually added to these kinds of transactions. A decree published in the Royal Gazette on Tuesday says that the tax cut will start on April 1, 2022. Local news stories say that it will stay in place until December 31, 2023.
This plan is all about getting trading platforms registered with the Ministry of Finance. In March, this plan was given the green light by the cabinet. Since the decision was written up in the government’s official journal, it is now Thai law. After it becomes official, it will start to work the next day.
The main goal of the tax exemption, according to the paper, is to make it easier for people to trade cryptocurrencies on legal exchanges. This will make it possible for the Securities and Exchange Commission and other groups to keep an eye on and track bitcoin transactions (SEC).
Arkom Termpittayapaisit, Thailand’s Minister of Finance, thinks that easing tax rules will make the country’s cryptocurrency exchange market more reliable and stable. Also, he is said to have said the following:
This would be a good reason for Thailand to build a payment system and infrastructure that are ready for the next digital economy.
Thailand is trying to get a better name in the whole digital world. The general director of the Revenue Department, Ekniti Nititthanprapas, said that investors would be able to trade cryptocurrencies more easily because taxes will be handled fairly and transactions will be safe.
Another royal decree, which came out on May 24, expands the VAT exemption to include retail transactions that use Thailand’s central bank digital currency (CBDC). The same king or queen issued the command. In December, the Bank of Thailand said it would start testing CBDC as an alternative way for customers and financial institutions to pay. Around the end of 2022, the testing will start.
In the last few years, there has been a big rise in the number of people investing in and trading cryptocurrencies in Thailand. At the end of March, the country’s banking authorities took steps to make it harder to pay with cryptocurrencies.
This was done to protect the economy and financial system from many threats. The SEC has made rules that will make it harder for operators of digital assets to offer services that go with them. This was done to protect the economy and money from many dangers.
Most of the time, the value-added tax is added to all goods and services that are sold. So, if they are bought with Bitcoin or a similar cryptocurrency, they should be treated the same way as any other goods or services when it comes to VAT.
When getting paid in cryptocurrency, VAT should be added to the amount equal to what one pound sterling was worth in bitcoin at the time the service was given. HM Revenue knows, though, that there isn’t always a single exchange rate for cryptocurrencies. As long as a good faith effort is made to use an accurate valuation for the transaction, this should be fine. Speaking of cryptocurrency, anyone can invest in Bitcoin and earn a fortune with user-friendly software like https://bitcoin-billionaire.com/ where the process can be explained using terms that are easy to understand.
