According to a report by the daily newspaper The Financial Times on February 1, Thailand will currently put a hold on their implementation of the 15% withholding tax on cryptocurrency trading after receiving backlash from the public. However, certain regulations relating to any crypto activities are still in place.
Initially, Thailand’s Revenue Department wanted to impose a tax on the people who are trading and mining cryptocurrencies as stated in a news report by the local newspaper the Bangkok Post on January 6. The move was made to regulate cryptocurrency trading in the country.
Despite the plans of the government, this was met with strong opposition from many people given its unclear rules on how it would be executed. One of those was co-founder and CEO at the big local exchange Zipmex Thailand, Akalarp Yimwilai, who pointed out that it was uncertain how the reporting and calculating of crypto tax will be done.
In a statement through the crypto news site Cointelegraph on January 6, Yimwilai said that ‘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’.
Following the announcement of the government regarding crypto tax, the country’s Committee on Monetary Affairs, Finance, Financial Institutions and Financial Market held an online meeting to talk about the issues of putting a tax on crypto transactions on January 19.
A ruling party member of the parliament, Watanya Wongopasi, shared the highlights of the discussion through her Facebook page on January 20. She urged the Excise Department to thoroughly think about the situation before the full implementation of any crypto tax regulations.
As stated on the same post, Wongopasi showed the different points that were raised during the virtual meeting. The chairman of the Federation of Thai Capital Market Organizations, Paiboon Nalinthrangkun, stated that putting a tax on stock trading and digital asset trading could decrease the market liquidity by 40% because ‘foreign and short-term investors will disappear’.
On another hand, Yutthana Srisavat, the CEO and founder of Bangkok-based software company iTAX Dr, suggested implementing a corporate tax or value-added tax rather than a trading tax. Moreover, he highlighted that gathering any tax-related information from the users will be challenging due to the decentralized nature of cryptocurrency transactions.
Meanwhile, the top financial regulatory bodies of Thailand namely the Bank of Thailand (BOT), the Thai Securities and Exchange Commission (SEC) and the Thai Ministry of Finance (MOF) released a joint press release on January 25 stating their discussion about the pros and cons of widespread use of digital currencies in the country.
Governor of the BOT, Sethaput Suthiwartnarueput stated: ‘At present, the widespread adoption of digital assets as a means of payment for goods and services poses risk to the country’s economic and financial system’, according to a report by Cointelegraph on January 25.
The companies have yet to release the final guidelines regarding this matter but they did stress that they will provide regulations for certain digital assets without risking the financial system.
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