Thailand’s New Crypto-Tax Laws Could Have Dire Effects For AsiaApr 4, 2018, 12:42AM
Thailand’s Finance Minister has announced the country’s new laws for the taxation of cryptocurrencies. The laws reflect a trend in Asia towards the over-regulation of crypto.
On March 27, Thai Finance Minister Apisak Tantivorawong outlined Thailand’s new tax framework for cryptocurrency trades and investments. The newly devised framework brings Thailand’s government one-step closer to a comprehensive regulation of the country’s bustling crypto-market. It will be formally enacted pending publication by the Royal Gazette.
Under the new taxation laws, investors and traders will have to pay a 7% Value Added Tax (VAT) on all crypto trades and will be liable for a 15% tax on all capital gains. The law has been under development since early 2018 and is part of a broader move by Thailand’s government to curb potential money-laundering and tax-evasion. Thailand’s Finance Ministry and Securities and Exchange Commission (SEC) are also in the process of drafting laws that will require all digital asset exchanges, brokers and dealers to register their businesses with the government in order to operate within the country.
Thailand’s crypto-regulation strategy mirrors the conservative views of the reigning military regime, and some fear that regulation will stifle the potential of the new crypto-boom in Thailand. The Nikkei Asian Review has published an article detailing the effect the new regulations are having on new crypto-pioneers in Thailand, who are choosing to move their operations to Singapore where regulations are less heavy-handed.
At present, Asia’s changing regulatory climate is having a large impact on both new and established crypto-platforms. Binance’s founder, Zhao Changpeng, is currently battling regulatory bodies in both Hong Kong and Japan, and has chosen to move the Binance operation to Malta. Bitfinex has also considered moving their operation from Asia to Switzerland, once again showing how heavy regulation is deterring businesses from continuing operations within Asia.
With Thailand poised to begin enforcement of their new regulatory framework, many will be watching to see if the conservative regulatory approach has a negative impact on the crypto-industry in Thailand, and Asia as a whole.
Disclaimer: information contained herein is provided without considering your personal circumstances, therefore should not be construed as financial advice, investment recommendation or an offer of, or solicitation for, any transactions in cryptocurrencies.