Tax Incentives for Human Resource Development in Thailand
- Thailand is offering up to 200 percent corporate income tax deductions for businesses that invest in human resource development.
- Businesses can also receive tax deductions for investing in STEM education or vocational programs.
- The development of human capital is vital for the country to develop technology-based industries.
The government is offering tax incentives for businesses that invest in human resource development. This is an important pillar of the Thailand Plus stimulus package, and the overall Thailand 4.0 vision, which aims to accelerate digital transformation and innovation in the country by 2035.
At the heart of this master plan is the Eastern Economic Corridor (EEC) – a special economic zone – which has been touted as the center of Thailand’s future technology-based industries such as artificial intelligence, bioscience, aerospace engineering, and robotics.The government intends to shift from its dependence on the traditional garment and agriculture sectors to high-value manufacturing and plans to spend more than US$45 billion on this vast territory.
What are the available tax incentives?
The government is encouraging investors to establish educational or training institutions and collaborate with local institutions particularly in the field of science, technology, engineering, and math (STEM).
Thailand’s Board of Investment (BOI), the government agency responsible for foreign investments into Thailand as well as Thai investments overseas, has granted corporate income tax (CIT) exemption for five years for companies investing in STEM education or vocational programs in the country.
Educational institutions are also exempt from import duty on scientific equipment and tools designed for their maintenance.
The BOI has provided businesses up to 200 percent CIT deduction for expenses related to internal or external STEM training courses for employees. Furthermore, businesses can also receive up to 100 percent CIT deduction for expenses related to apprenticeship programs.
It is important to note that these courses and programs must be endorsed by the Ministry of Higher Education, Science, Research and Innovation or the Eastern Economic Corridor Office(if the activity occurs in the EEC). Applications for these incentives must be submitted by 2021.