Thailand: investment incentives for regional operating heaquarters
Description
The Thailand Board of Investment, responsible to the government of Thailand introduced a package of tax incentives for foreign and Thai companies with regional operating headquaters in Thailand. Companies that fulfill the requirements (relaxed now) will be able to corporate income tax exemption for 10 years on income derived from services provided to its entities abroad and a reduction of corporate income tax rate from 30% to 10% on income from services provided to local affiliated entities. The government believes that by creating regionally the most attractive tax incentives, the new scheme will result in higher revenue streams for foreign and Thai regional operating headquaters and hopes for an inflow of foreign capital investment. This measure alters the basis of competition between those supplying regional headquarter services, to the disadvantage of those supplying them from abroad.
Any Evidence-Based Deliberation:
| Question | Result |
|---|---|
| Is there anything in the public record to suggest that evidence of the effectiveness of the proposed measure was considered during official deliberations? | |
| Is there any evidence that alternatives to the proposed measure were considered? | |
| Is there anything in the public record that suggests that empirical evidence informed the comparison across the alternatives available to government? | |
| Was such evidence identified? | |
| Is such evidence publicly available? | |
| Did the official decision-maker in question provide an explanation as to why a chosen measure was favoured over alternatives? | |
| Is there any evidence to suggest that potentially affected trading partners were consulted before the measures were taken? | |
| Is there any evidence that safeguards have been put in place to ensure that implementation of the initiative is transparent and non-discriminatory? | |
| Did the government state its intention to review the measure within one year of implementation? |
Date Discovered:
Implemented: Yes
Date of inception: 2 Jun 2010
GTA Evaluation: Red
Source:
As reported by Baker and McKenzie
Regional Operating Headquarters (ROH) - A New Wine in a New Bottle
The Revenue Department, Thailand
http://www.rd.go.th/publish/6007.0.html
A guide to the new tax regime for regional corporate HQs
http://www.nationmultimedia.com/home/2010/06/30/opinion/A-guide-to-the-n...
Rethinking regional operating headquarters
http://www.internationaltaxreview.com/includes/magazine/PRINT.asp?SID=72...
Government Response:
- 690 reads
