Board of Investment (BOI) Incentive/Privilege
1. Privileges by location
Regarding the investment incentives, the BOI has made adjustment to the zoning system. Promoted projects locating in these Zones may receive additional incentives, including further tax and duty reductions, as well as allowances for infrastructure investments. There are three zones as follows:
Zone 1 includes Bangkok, Samut Prakan,Samut Sakhon, Nakhon Pathom, Nonhtaburi and Pathum Thani (Bangkok and 5 provinces).
Zone 2 includes Ang Thong, Ayutthaya, Chachoengsao, Chon Buri, Kanchanaburi, Nakhon Nayok, Phuket, Ratchaburi, Rayong, Samut Songkhram, Saraburi and Suphanburi (12 provinces).
Zone 3 encompasses the remaining 58 provinces.
Projects in Zone 1 shall be granted:
1. 50 per cent reduction of import duty on machinery that is subject to import duty of not less than 10 per cent;
2. Corporate income tax exemption for 3 years for projects located within industrial estates or promoted industrial zones, provided that such a project with capital investment of 10 million baht or more (excluding cost of land and working capital) obtains ISO 9000 or similar international standard certification within 2 years from its start-up date, otherwise the corporate income tax exemption will be reduced by 1 year;
3. Exemption of import duty on raw or essential materials used in the manufacturing of export products for 1 year.
Projects in Zone 2 shall be granted:
1. 50 per cent reduction of import duty on machinery that is subject to import duty of not less than 10 per cent;
2. Corporate income tax exemption for 3 years, increased to 5 years for projects located within industrial estates or promoted industrial zones, provided that such a project with capital investment of 10 million baht or more (excluding cost of land and working capital) obtains ISO 9000 or similar international standard certification within 2 years from its start-up date, otherwise the corporate income tax exemption will be reduced by 1 year;
3. Exemption of import duty on raw or essential materials used in the manufacturing of export products for 1 year.
Projects in Zone 3 shall be granted:
1. Exemption of import duty on machinery;
2. Corporate income tax exemption for 8 years provided that a project with capital investment of 10 million baht or more (excluding cost of land and working capital) obtains ISO 9000 or similar international standard certification within 2 years from its start-up-date; otherwise, the corporate income tax exemption will be reduced by 1 year;
3. Exemption of import duty exemption on raw or essential materials used in the manufacturing of export products for 5 years.
Projects located in one of the following 36 provinces of Zone 3: Chai Nat, Chanthaburi, Chiang Mai, Chiang Rai, Chumphon, Kamphaeng Phet, Khon Kaen, Krabi, Lamphang, Lamphun, Loei, Lop Buri, Mae Hong Son, Mukdahan, Nakhon Ratchasima, Nakhon Sawan, Nakhon Si Thammarat, Phangnga, Phattalung, Phetchabun, Phetchaburi, Phitsanulok, Pichit, Prachin Buri, Prachuab Khiri Khan, Ranong, Sa Kaew, Sing Buri, Songkhla, Sukhothai, Surat Thani, Tak, Trang, Trat, Uthai Thani, and Uttaradit, shall be granted Zone 3 tax and duty privileges and further privileges, as follows:
(1) A project located within industrial estates or promoted industrial zones is entitled to the following privileges:
(1.1) 50 per cent reduction of corporate income tax for 5 years after the exemption period;
(1.2) Double deduction from taxable income of transportation, electricity and water costs for 10 years from the date of first revenue derived from promoted activity;
(2) For a project located outside industrial estates or promoted industrial zones, a deduction can be made from net profit of 25 percent of the project's infrastructure installation or construction cost for 10 years from the date of first sales, and net profit for one or more years of any year can be chosen for such deduction. The deduction is additional to normal depreciation.
Projects located in one of the following 22 provinces: Amnat Charoen, Buri Ram,Chaiyaphum, Kalasin, Maha Sarakham, Nakhon Phanom, Nan, Narathiwat, Nong Bualamphu, Nong Khai, Pattani, Phayao, Phrae, Roi Et, Sakhon Nakhon, Sathun, Si Sa Ket, Surin, Udon Thani, Ubon Ratchathani, Yasothon, and Yala shall be granted Zone 3 tax and duty privileges and further privileges as follows
(1) 50 per cent reduction of corporate income tax for 5 years after the exemption period;
(2) Double deduction from taxable income of transportation, electricity and water costs for 10 years from the date of first revenue derived from promoted activities;
(3) Deduction can be made from net profit of 25 percent of the project's infrastructure installation or construction cost for 10 years from the date of first sales, and net profit for one or more years of any year can be chosen for such deduction. The deduction is additional to normal depreciation.
