"Your Strategic Entry to Thailand: Leveraging the Power of the BOI"

The Thailand Board of Investment (BOI) is a crucial government agency that plays a pivotal role in attracting and facilitating foreign and domestic investment into Thailand. Its core mission is to enhance Thailand's competitiveness and promote sustainable economic growth by offering a comprehensive package of incentives and services to eligible businesses.

Here are the key details about the BOI:

What is the BOI?

• Government Agency: The BOI is an agency under the Office of the Prime Minister of Thailand.

• Mission: Its primary mission is to promote investment, both from foreign and local entrepreneurs, in specific industries and activities that are deemed beneficial to Thailand's economic development.

• Established: It was established in 1966.

Why was the BOI created?

• To attract investment that leads to technology transfer and innovation.

• To decentralize Thailand's industrial base and promote investment in various regions.

• To nurture local skill development and create high-value-added industries.

• To enhance Thailand's global competitiveness and help the country avoid the "middle-income trap."

Key Services Provided by BOI:

The BOI acts as a "single window" for investors, offering a range of services:

1. Information and Advisory Services: Providing comprehensive information on investment opportunities, policies, and regulations in Thailand.

2. Investment Promotion Application: Assisting investors through the application process for investment promotion, including preparing documents, attending interviews, and liaising with government officers.

3. Facilitation Services: 

   • Visa and Work Permit Facilitation: Streamlining the process for foreign experts, skilled workers, and their dependents to obtain visas and work permits for promoted projects.

   • Land Ownership: Granting permission for promoted projects (even those with 100% foreign ownership) to own land, which is otherwise restricted under the Foreign Business Act.

   • Money Remittance: Facilitating the remittance of money abroad in foreign currency.

4. Business Matching and Sourcing: Connecting investors with local partners, suppliers, and sourcing of domestic raw materials.

5. Post-Promotion Services: Providing ongoing support for compliance, reporting, and addressing any issues that may arise after promotion has been granted.

   
   

Key Incentives Offered by BOI:

The BOI offers both tax and non-tax incentives, categorized by the importance and type of activity.

1. Tax Incentives:

• Corporate Income Tax (CIT) Exemption: This is one of the most attractive benefits. Companies can receive exemptions for a period ranging from 3 to 13 years, or even up to 15 years for certain high-priority activities, often without a cap on the amount of exempted income. The duration and cap depend on the promoted activity, location, and the level of technology or innovation involved.

• 50% Reduction in Corporate Income Tax: After the tax holiday expires, some projects may qualify for a 50% reduction in CIT for an additional period (e.g., up to 5 years).

• Exemption or Reduction of Import Duties: 

  • Exemption of import duties on machinery for promoted activities.

  • Exemption of import duties on raw and essential materials imported for manufacturing for export.

  • Reduction of import duties on raw and essential materials for manufacturing for domestic sale (up to 90% in some cases).

  • Exemption of import duties on items used for R&D purposes.

• Double Deduction of Costs: Double deduction from taxable income for transportation, electricity, and water supply costs for a specified period (e.g., 10 years).

• Deduction of Infrastructure Installation Costs: Deduction from net profit of 25% of the project's infrastructure installation or construction costs, in addition to normal depreciation.

  
  

2. Non-Tax Incentives:

• 100% Foreign Ownership: Permission for foreign nationals to hold 100% equity in certain promoted activities, even in sectors normally restricted by the Foreign Business Act (FBA).

• Land Ownership Rights: The ability for foreign-owned companies to own land for their promoted projects.

• Work Permit and Visa Facilitation: Easier and faster processing of visas and work permits for foreign executives, experts, and technicians, along with their families.

• Permission to Bring in Skilled Workers/Experts: The right to bring in foreign skilled workers and experts to work on promoted projects.

• Protection Measures: Guarantees against nationalization and state competition.

Promoted Industries and "S-Curve" Industries:

The BOI focuses its promotion efforts on "S-Curve" industries, which are categorized into "First S-Curve" and "New S-Curve" to drive Thailand's economic transformation towards a value-based and innovation-driven economy (Thailand 4.0).

First S-Curve Industries: (Often considered foundational or already strong)

• Next-Generation Automotive (e.g., Electric Vehicles)

• Smart Electronics

• Affluent, Medical, and Wellness Tourism

• Agriculture and Biotechnology

• Food Processing

New S-Curve Industries: (Targeted for future growth and high technology)

• Robotics and Automation

• Aviation and Logistics

• Digital (e.g., Data Centers, Software, AI, Cybersecurity)

• Biofuels and Biochemicals (Bio-Circular-Green Economy)

• Comprehensive Healthcare (including medical devices, specialized medical services)

The BOI also categorizes promoted activities into groups (e.g., A1+ to A4 for technology-intensive activities, and B for others) with varying levels of incentives. Generally, the higher the value-added, technology intensity, and environmental benefits of a project, the greater the incentives offered.

Application Process:

The BOI application process typically involves:

1. Feasibility study and initial consultation.

2. Application submission with a detailed business plan.

3. Interview with BOI officers.

4. Approval and acceptance of promotion terms.

5. Company registration and obtaining the BOI certificate.

6. Ongoing compliance and reporting.

For any businessman looking to invest in Thailand, especially in the strategic sectors, engaging with the BOI is a crucial first step to maximize benefits and streamline the establishment process.