According to a draft version of a royal decree, ICO issuers in Thailand will have 90 days to inform the SEC of their intentions. The document also states that digital asset trades will be subject to a 15 percent capital gains tax and a seven percent value-added tax, regardless of a trade’s profitability.
On March 27, 2018, the secretary general for Thailand’s SEC, Rapee Sucharitakul, shared that in its effort to protect investors, the commission will soon enforce rules governing cryptocurrencies and initial coin offerings (ICOs). “This is a very specialized market and it’s not for ordinary people,” he said in an interview, according to Bloomberg.
Although the regulations have not yet received royal endorsement from King Maha Vajiralongkorn, Sucharitakul said they will take effect in approximately three weeks. Those measures are also expected to include disclosure and warning requirements as well as information regarding tax treatment.
Today, the Bangkok Post reported on a preliminary version of a royal decree that addresses digital asset regulation. The decree, approved by the Thai Cabinet on Tuesday, states that ICO issuers will have 90 days to communicate with the SEC before the law goes into force. According to Finance Minister Apisak Tantivorawong, this timeframe was increased from 60 days after complaints from “market participants.”
Additionally, the decree would fine-tune the definition of “digital assets” to encompass only cryptocurrencies and digital tokens (as opposed to “electronic data” more broadly).
Significantly, the decree will also clarify the tax treatment of digital asset trades. Unfortunately, Thai investors might not be pleased by the new standards.
Digital asset trades will be subject to a 15 percent capital gains tax as well as a seven percent value-added tax (VAT). The Post reported that the VAT applies even to trades that “produce no gains.”
As companies develop blockchain-based services and digital assets in Thailand, the nation’s regulators have been attentive. In February, the Bank of Thailand ordered financial institutions to avoid cryptocurrency investments and to not facilitate cryptocurrency trading. The central bank also banned cryptocurrency purchases made using credit cards.
In September 2017, the Thai SEC released ICO guidance and warned that some digital assets may be subject to securities laws.
Thailand remains under military rule, largely led by Prime Minister Prayut Chan-o-cha, a retired Royal Thai Army officer who now serves as head of the National Council for Peace and Order.
Matthew is a writer with a passion for emerging technology. Prior to joining ETHNews, he interned for the U.S. Securities and Exchange Commission as well as the OECD. He graduated cum laude from Georgetown University where he studied international economics. In his spare time, Matthew loves playing basketball and listening to podcasts. He currently lives in Los Angeles. Matthew is a full-time staff writer for ETHNews.
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