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March 10, 2023
Thailand plans to implement global minimum tax rules under OECD BEPS 2.0 Pillar Two
Thailand announced its plans to implement the global minimum tax rules under the OECD BEPS 2.0 Pillar Two and assigned the Revenue Department to draft the associated legislation. In addition, the BOI has been assigned to consider measures to alleviate impacts from the implementation of Pillar Two on the existing tax incentive programs.
Further details of the implementation and associated regulations have yet to be announced. Companies may expect adequate notice ahead of any rules becoming effective.
On 7 March 2023, the Thai Cabinet approved in principle the implementation of the global minimum tax in Thailand and assigned the Revenue Department and BOI to proceed as outlined below.
1) The Revenue Department is to draft the associated legislation and set the guidelines to:
2) The BOI will consider providing cash grants to qualifying investors, subject to the investment/spending amount that would promote Thailand’s competitiveness and long-term investment.
Even though the legislation is not yet enacted, in-scope MNEs should begin assessing its potential impacts from the implementation of global minimum tax rules and be ready for the anticipated law changes. They should also be well-prepared in terms of resources and processes to ensure proper data collection and analysis management, global minimum tax liability computation, and applicable reporting obligations.
For additional information with respect to this Alert, please contact the following:
EY Corporate Services Limited, Bangkok
Ernst & Young LLP (United States), Thai Tax Desk, New York
Ernst & Young LLP (United States), ASEAN Tax Desk, New York
Ernst & Young LLP (United States), Asia Pacific Business Group, New York
Ernst & Young LLP (United States), Asia Pacific Business Group, Chicago