Thailand is increasingly intensifying its regulatory stance on crypto and the latest move is a capital gains tax levied on crypto traders in the Kingdom.
Profits from cryptocurrency trading will now be subject to a 15% capital gains tax according to the Thai Finance Ministry.
The ministry advised those involved with cryptocurrencies to accurately report their incomes when filing taxes this year according to a Jan 6 report in the Bangkok Post. It did not specify if this would be applied to unrealized gains.
Thailand crypto taxman commeth
The report added that the new tax would be applicable to investors and mining operators, however, crypto asset exchanges are exempt from such duties. Some of the largest exchanges in Thailand are affiliated with banks and billionaire business moguls.
Thailand’s largest exchange, Bitkub, was acquired by the country’s oldest bank, Siam Commercial Bank, in a 51% takeover in November. Upbit Thailand is owned by family members of the country’s largest food monopoly CP Group. Meanwhile, Zipmex Thailand raised more than $40 million from the country’s fifth-largest lender, Bank of Ayudhya in August.
The Thai Revenue Department plans to beef up its surveillance of the crypto industry this year following a surge in trading volume in 2021.
Exchange bosses like Akalarp Yimwilai, co-founder and CEO of Zipmex, said that calculating taxes is complicated, especially if exchange rates with USD need to be factored in;
Tax methods and calculations should be more concise, clear and easy to understand. Many people I know want to pay taxes, but don’t know how to calculate them,
It’s currently unclear whether the taxes will be levied on annual filings or whether the government will make the exchanges deduct it at the source. The latter would undoubtedly douse the flames fuelling the crypto trading fever Thailand has enjoyed over the past year.
Mixed messages
The Kingdom’s tourism ministry is attempting to foster the fledgling crypto industry in order to attract big bag holders to revive the battered tourism industry.
However, those efforts are being quashed by the central bank and government which clearly intends to crack down further on crypto assets.
In December, the Bank of Thailand stated that it would be drawing up new measures to regulate crypto-related activities for individuals and businesses. The central bank will release a consultation paper on the “financial landscape” this month seeking consensus for what it calls “red lines” for crypto-related businesses.
Central bankers have repeatedly warned commercial banks and local businesses away from accepting digital assets as payments.
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