In a move which affirms the careful stance Thailand has taken up toward cryptocurrencies, the country’s military government is looking to implement new laws for regulating the burgeoning cryptocurrency market by introducing taxation on digital currencies.
As reported by Nikkei Asian Review, the development was announced on March 27 by Thailand’s Finance Minister Apisak Tantivorawong, followed by a weekly cabinet meeting. Tantivorawong confirmed that as per the new laws, investors are obligated to pay a flat 7% value-added tax on all cryptocurrency exchanges, together with a 15% capital gains tax on returns from crypto investments.
This development comes a few weeks after the Central Bank of Thailand banned financial institutions in the country from engaging in cryptocurrencies.
A royal decree draft concerning regulation of crypto taxation in order to curb theft and tax evasion has also recently been approved by the Cabinet of Thailand.
Remarking on the conservative attitude adopted by the Bank of Thailand and the finance ministry, former finance minister and Thai Fintech Association chairman Korn Chatikavanij said that the Thai authorities “have to be cautious not to allow their conservative instincts to result in draconian regulations”.
In the previous month, while sanctioning the appointment of the Securities and Exchange Commission as the regulatory authority for cryptocurrencies, Chatikavanij also stressed that laws and regulations for digital assets should not concentrate solely on stifling or banning such activities.
He pointed out that unnecessarily restrictive laws could force Thai startups to shift abroad. Owing largely to its relaxed and accommodating policies, Singapore has become a major fintech hub in Asia. As the climate for projects looking to raise funds via initial coin offerings (ICOs) in Thailand becomes more obstructive and unsure, ventures such as Six.network, have decided to move to Singapore.
Nevertheless, Nikkei reports that the citizens of Thailand remain as crypto-crazy as ever, as evinced by the ICO’s, startups and crypto-focused seminars in the country.