Foreign investors, professionals and retirees will be able to take advantage of a number of new incentives in Thailand, as the government seeks to attract high-income foreign residents to help the country recover from COVID-19.
The Thai cabinet passed a resolution on September 14, 2021, introducing immigration, tax and land ownership incentives for foreign investors and skilled professionals. The incentives are part of an effort to stimulate the Thai economy which has been hit hard by the COVID-19 pandemic.
According to a government spokesperson, the government expects the incentives to attract more than a million foreign investors and professionals within five years, contributing more than 1,000 billion baht (30 billion dollars) to the economy.
In this article, we take a look at what incentives will be available and who is eligible to apply for them.
What are the incentives?
The incentives fall into three categories: immigration, tax and real estate.
Qualified applicants can receive a 10-year long-term resident visa to live in Thailand, including for their spouse and children. Qualified applicants will also receive an automatic work permit. This is a new type of visa that previously did not exist in Thailand.
Unlike other types of visas, holders of long-term resident visas will not have to submit a written notification to the competent authorities to stay in the country for more than 90 days. Potentially, they will not be subject to restrictions on hiring foreign workers, such as the requirement that employers hire four Thai workers for each foreigner, although that remains to be determined.
Qualified applicants will be able to benefit from the same income tax rates as Thai citizens, as well as tax exemptions for income earned abroad. In addition, they can claim a fixed tax rate of 17 percent according to the Eastern Economic Corridor scheme.
Land and property
Qualified applicants will be able to benefit from relaxed restrictions on foreign ownership and rental of land and property.
The incentives will be overseen by the Office of the National Economic and Social Development Council of Thailand. They will be in place for five fiscal years from 2022 to 2026, when the authorities will assess their performance and decide to extend them.
Prospective applicants should note that while the Thai government has confirmed incentives in these areas, details in some areas, such as land and property, have yet to be clarified.
Who is eligible for the incentives?
The incentives apply to four categories of foreigners: wealthy citizens of the world, wealthy retirees, working Thai professionals, and highly skilled professionals.
Rich world citizens
Individuals with income of at least $ 80,000 in the past two years and assets of at least $ 1 million may be eligible for the incentives. In addition, they must have medical insurance covering at least $ 100,000 and invest at least $ 500,000 in Thai government bonds or real estate.
Retirees with a stable pension of at least USD 40,000 per year and aged 50 or over can apply. They too must have medical insurance covering at least $ 100,000 and invest at least $ 250,000 in Thai government bonds or real estate.
Work of Thai professionals
Foreign professionals working remotely from Thailand (often referred to as digital nomads), with an income of at least USD 80,000 in the past two years and at least five years of professional experience will be eligible.
Highly qualified professionals
This category refers to professionals with an income of at least $ 80,000 in the past two years or $ 40,000 per year who work in targeted industries, including construction infrastructure, logistics systems and digital systems, or experts and researchers who work with state agencies or as university professors.
Stimulate recovery in the event of a pandemic
The incentives are part of an effort to boost Thailand’s economic recovery from the COVID-19 pandemic and to encourage foreigners to travel, live and work in the country. During the five years of the initial eligibility period of the incentives, the government plans to raise 800 billion baht (US $ 24.1 billion) from investments, 270 billion baht (US $ 8.1 billion) from income tax collection, 70 billion baht (US $ 2.1 billion) in value added tax and 22 billion baht (US $ 662 million) in investment-related taxes.
Incentives are one of the many measures to encourage foreigners to travel, live and work in Thailand. Recently, the Thai authorities have also relaxed a ban on the sale of alcohol in some areas that were in place to discourage people from going to bars and clubs amid COVID-19 outbreaks. Previously, Thailand had launched the “Reopen the Sandbox” program to allow parts of the country to ease restrictions on foreign tourists.
Note, not all details are clear for the new incentives for foreigners, even though they were voted on by the cabinet. More details on issues needing clarification, such as what form land incentives will take and how applicants can prove their net worth, are expected to surface in the coming months.
ASEAN Briefing is produced by Dezan Shira & Associates. The firm assists foreign investors throughout Asia and has offices throughout ASEAN, including Singapore, Hanoi, Ho Chi Minh City, and Da Nang In Vietnam, Munich, and Esen in Germany, Boston, and Salt lake city in the USA, Milan, Conegliano, and Udine in Italy, in addition to Jakarta, and Batam in Indonesia. We also have partner companies in Malaysia, Bangladesh, the Philippines, and Thailand as well as our practices in China and India. Please contact us at [email protected] or visit our website at www.dezshira.com.