Thailand Challenges for a Piece of the Crypto Pie By Waiving Taxes

[Hydrogen]

• Thailand is offering companies raising funds through initial coin offerings exemptions from income and value-added tax.
• The country has shown promise, with a recent report pegging the country as the nation with the highest global level of crypto adoption.
• However, it needs to compete with a recent Web 3 accelerator program launched by the Hong Kong.

Thailand will not charge companies raising capital through Initial Coin Offerings income and value-added tax as it looks for a slice of the Asian-driven bull run predicted by billionaire Cameron Winklevoss.

Members of Thailand’s cabinet ruled that companies raising funds through “investment tokens” can also raise funds through debentures, Executive Committee member Rachada Dhnadirek told the Bangkok Post.

Thai Government Foregoes Over $1 Billion With Tax Waiver

Under the new ruling, the Thai government will lose about $1 billion in taxes from about $3.7 billion raised through initial coin offerings over the next two years. It has not indicated whether companies must perform disclosures to the Thai Securities and Exchange Commission before running ICOs.

Thailand has proven growingly attractive for crypto firms, competing directly with Asian counterparts Hong Kong and Singapore.

According to The Bangkok Post, a tax software company Recap report revealed Thailand had gained 57 crypto companies and had the second-highest crypto ownership rate. Ownership grew despite a government that had banned crypto payments citing financial stability risks.

According to Recap CEO Daniel Howitt, tightening crypto regulations will determine whether Thailand can be an Asian crypto hub.

“Like many countries, Thailand is tightening its rules on the trading of crypto and advertising of digital assets, too. With stricter rules in place, it’ll be interesting to see whether this helps or hinders Bangkok’s place as a crypto hub in the coming months,” he told the Bangkok Post.

Last year, the Securities and Exchange Commission vowed to introduce greater investor protections by limiting celebrity advertising in the wake of the FTX collapse. It has yet to announce a new leader after the board reportedly declined to renew the term for the agency’s secretary-general, whose contract will expire at the end of April 2023

The Cyber Crime Investigation Bureau recently warned Thai citizens of cryptocurrency scams perpetrated through overseas exchanges.

Can Thailand Compete With Hong Kong?

Meanwhile, Hong Kong is capitalizing on Singapore’s tightening regulation caused by several high-profile crypto fallouts.

Last year, Singapore’s Monetary Authority released consultation papers to propose tighter regulation for customer funds held on crypto exchanges. These consultations will likely be consummated to a large degree during the first half of 2023.

Additionally, the city-state wants to impose banks’ cyber risk frameworks on crypto platforms.

Singaporean authorities are still searching for Do Kwon, the co-founder of Singapore-based Terraform Labs, the company behind collapsed stablecoin TerraUSD.

Singapore crypto exchanges Zipmex and Vauld filed for creditor protection in July 2022 after being stung by the TerraUSD meltdown. Vauld received an extension to March 24, 2023, to finalize its restructuring plan.

On the other hand, Hong Kong has embraced the asset class, mitigating investor risk through knowledge tests and reasonable limits on crypto exposure. It has also received support from crypto mogul Justin Sun and several Chinese officials.

If Thailand is to compete with Hong Kong, it will likely need significant investment. The Hong Kong government has committed $6.4 million annually to Web 3 firms.

https://beincrypto.com/thailand-challenges-asian-counterparts-for-crypto-waiving-taxes/

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What was the moment when you realized crypto may have broken through to becoming big business?

Under the new ruling, the Thai government will lose about $1 billion in taxes from about $3.7 billion raised through initial coin offerings over the next two years. It has not indicated whether companies must perform disclosures to the Thai Securities and Exchange Commission before running ICOs.

Given current economic conditions, where many nations of the world are in desperate need of funding to offset rising deficits.

Do we have a potential scenario for cryptocurrencies emerging as one of the primary go to options for financing future state held debt?

Legalizing and taxing marijuana, legalizing and taxing gambling, legalizing and taxing prostitution. These have been the typical go to options for many states to boost tax revenues. Although they may be associated with higher incidence of violence and crime. Requiring greater funding for police and law enforcement, as well as regulatory agencies.

Crypto by contrast could be a cleaner and more moral industry. It may also be quicker to startup, requiring less overhead and support from subsidies.

Anyway, long story short. How do people feel about this. How do they see it going?

[hugeblack]

According to what I understood from the article, they will not be taxed through the Initial Coin Offerings, but it does not mean complete exemption from taxes, and therefore they are correct. They lose a billion, but they attract an industry that may generate billions. The decisive point is how to protect the depositors’ money, which I do not know how they will do.

Personally, I do not like laws that give a lot of tolerance to alternative currencies and do not set a clear framework for Bitcoin and Cexs/

[harapan]

Anyway, long story short. How do people feel about this. How do they see it going?

I think it's a good investment. Its a favorable policy to crypto companies and in the long run also favorable to Thailand because this will attract a lot of companies that would generate billions to Thailand. It would also create employment and human capital amongst other things. This is also a wonderful development to the crypto industry. Policies like these are the steps that improves the crypto space. When other economies see how beneficial this has been to Thailand, hopefully they follow suit and make more favorable policies.

[Lucius]

At first I thought it was an old article, because is ICO in the world of cryptocurrencies still something that someone is seriously talking about? So Thailand wants to promote itself as a crypto-hub in such a way that it will enable various scammers from all over the world to operate from their country, motivating them with an exemption from taxation?

Considering that Thailand is one of the countries where payment with Bitcoin is prohibited, this move seems like a bad April Fool's joke to me.

[el kaka22]

I think that's not too bad, it allows crypto to be more legal, and it gets taxed in the end, that's pretty good actually. I know that not many people like it when you have to pay taxes, definitely hate it when you have to pay a lot of taxes with nothing in return to show for, because governments just spend it on corruption and operational costs and doesn't give the public anything back.

However, at the end of the day making it legal and taxed means that Thailand is basically a pro-crypto nation and knowing that worths all the tax in the world. My nation is quite similar in that aspect, they tax it, not a lot but they still do, and that makes it legal, because if you were taxed, then it wasn't illegal.

[o48o]

Embrace the next huge wave of new Thai-ICOs! I have to see i didn't saw that coming. I am guessing because there are alreadt crypto expats living cheap in there
(that's what my crypto expat friend living in there tells me anyway)

This move attracts more of them and as they are bringing ton of money for locals buying with premium price and locals stay busy and happy because of increased commerce.

Smart move actually.

[temple]

At first I thought it was an old article, because is ICO in the world of cryptocurrencies still something that someone is seriously talking about? So Thailand wants to promote itself as a crypto-hub in such a way that it will enable various scammers from all over the world to operate from their country, motivating them with an exemption from taxation?

Considering that Thailand is one of the countries where payment with Bitcoin is prohibited, this move seems like a bad April Fool's joke to me.

Ok your comment got me thinking straight again. When you read the OP article you quickly forget about the stuff that has been passed there not too long ago. At first glance I liked the idea, but of course it does not make any sense as you are right that Thailand put a ban on many cryptocurrency related payment activities. In fact, serious crypto entrepreneurs won't go to a country where you are allowed to raise crypto, but not allowed to actually use crypto to pay for stuff. If I get the linked Bloomberg article right, companies raising crypto aren't even allowed to pay their employees with that crypto afterwards. I couldn't get my head around the trading situation, but the whole thing is fishy somehow.

I wonder if this is just one half of the story because otherwise it is exactly how Lucius says, it will only attract scammers as they don't intend to pay anyone after they raised money through an ICO.