Thailand Removes VAT for Regulated Crypto Exchanges, What about Indonesia?
According to the Bangkot Post report, Thailand is set to waive the requirement to pay a 7% value-added tax (VAT) on income earned from cryptocurrency trading.
The VAT exemption applies to regulated crypto exchanges, brokers, and dealers under the supervision of the Thailand Securities and Exchange Commission.
This tax exemption took effect on January 1, 2024, with no expiration date. Previously, in May 2023, the transfer of crypto assets or "digital investment tokens" to third parties had been exempted from VAT.
Paopoom Rojanasakul, the secretary of the finance ministry, stated that the ministry aims to promote digital assets as a new alternative tool for fundraising.
Authorities hope that this move will support the growth of the digital asset industry in Thailand and provide the necessary impetus to facilitate the country's digital economy in the near future.
Thailand Revisits Crypto Regulations
The SEC Thailand has also updated criteria for investing in digital tokens, easing some restrictions. The SEC committee has approved principles to enhance investment criteria and related criteria for digital asset business operations, aiming to establish effective investor protection mechanisms while considering the risks associated with digital assets.
Firstly, the commission has lifted investment restrictions previously imposed on retail investors for digital tokens backed by real estate or generating real estate income (real estate-backed ICOs) and tokens with infrastructure operations or income streams (infrastructure-backed ICOs).
Previously, retail investors were limited to investing a maximum of 300,000 baht per offering. The SEC also reviewed the criteria for establishing custodian wallet provider businesses, allowing them to offer services to digital asset business operators. However, the SEC Thailand has emphasized that they will not yet allow spot Bitcoin ETF trading in the country.
Indonesia Still Imposes VAT on Crypto Exchanges
Thailand's removal of VAT for transactions on registered crypto exchanges stands in stark contrast to Indonesia, which currently imposes a 0.11% VAT and a 0.1% income tax on registered exchanges.
The imposition of taxes on registered exchanges in Indonesia has been a particular concern for industry players, including Tokocrypto CEO Yudhono Rawis.
During the Tokocrypto event on January 31, Yudhono expressed hope that crypto taxes in Indonesia could be more competitive. He suggested schemes that could be considered.
Firstly, reverting to only applying capital gains tax, secondly, revising VAT regulations, as according to the PPSK law, crypto assets are not commodities but lean towards financial assets. Thirdly, reducing the current tax rates.
Another industry player, Indodax CTO William Sutanto, also hopes that these tax regulations can be reconsidered. He noted that the high final tax rates are driving over 60% of Indonesia investors' transaction volume to global exchanges.
*Disclaimer:
This content aims to enrich reader information. Always conduct independent research and use disposable income before investing. All buying, selling, and crypto asset investment activities are the reader's responsibility.
