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New Thai Laws Evermore Generous With Taxes
The general public should have little to complain about with the raft of legal changes in mid-2009. As the government strives to meet the needs of all its citizens, some legal decisions are inevitably controversial. Not so, though, the latest changes to Thai laws, which have included a wide variety of tax breaks for different areas of society. We look at the new advice Thailand lawyers will be giving their clients on taxation obligations.
The first change to taxation under Thai law was perhaps the widest-reaching, introducing immoveable property purchases as a tax deduction, when they are paid for with personal income. Thailand legal services see this move as designed to combat the effects of the global credit crisis, putting money back in the pockets of ordinary citizens.
The tax deduction is only available to natural persons, not companies, and the property must be paid for by personal income. The deduction is worth up to 300,000 baht over the course of 2009, and may be comprised of land, land plus a building, or a condominium. However, ownership of the property must be retained for at least 3 consecutive years.
Thai corporate legal services have seen several law changes recently aiming to promote real estate growth, including the refund of the Specific Business Tax which has just become available. Persons that purchased a property may be able to request a refund of any specific business tax paid through the Revenue Department.
The refund could be significant for some purchasers - 2008's reduction of the SBT from 3.3% to 11% ended on 29 March 2009, but was recently extended by a full year. Purchasers who paid the tax after 29 March and were charged at 3.3% can seek a refund from the Revenue department. Business lawyers in Thailand can help if the property was purchased by a company.
A recent taxation change in Thai law should have broad effects across not only the economic landscape, but the environmental one - import duties were almost completely scrapped for the raw materials and parts used to make environmentally friendly cars. The Board of Investment expects that this could reduce the cost of an eco-automobile to the consumer by as much as 100,000 baht.
The Board of Investment is also trying to stimulate growth and industry generally, and approved maximum tax incentives for new startups in the southern provinces hit hardest by separatist violence. Thai legal services have all the details of the business tax incentives in these provinces.
One of Thailand's greatest assets has always been its tourism value, and a recent change to Thai law on taxation of movie producers aims to capitalize on that. Foreign movie producers using Thailand as a location to shoot movies will provide a tax refund of 15-20%, and is expected to effectively double the value of the entertainment industry locally.
The current value is 900 billion baht, and business lawyers in Thailand expect that the refund should increase that value to 1.8 trillion baht. The Commerce ministry will also suggest new measures to help protect intellectual property rights, a contentious issue for movie makers.
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