Thailand implements crypto law, tax status still pending
A new law to regulate digital asset transactions brings the threat of jail to traders who do not register with the Securities Exchange Commission
In recent months a digital division has formed in Asia on where nations stand on crypto-currencies. Some are embracing the technology and opening their doors to foreign investment and innovation, while others are putting their efforts into devising more methods to clamp down on the industry and all things crypto.
Thailand most certainly belongs to the latter.
A new law to regulate digital asset transactions came into force on Sunday. The Kingdom, now in the lengthening grips of a military dictatorship, has already taken a harsh stance towards crypto-currencies, and according to the Bangkok Post, the Finance Minister, Apisak Tantivorawong, said the new law was “necessary to comprehensively regulate cryptocurrencies and digital tokens to prevent money laundering, tax avoidance and crime.”
The 100 section law defines digital tokens and tasks the country’s Securities Exchange Commission (SEC) to regulate crypto-currencies. Sellers of digital coins have been threatened with jail time if they do not register with the SEC within 90 days. The new law approved in March is, according to the Finance Ministry, not designed to prohibit digital currencies but to protect investors.
A deeper concern within the Kingdom is a heavy taxation system which is also about to be levied on crypto-currency trading. At the time of writing, this has yet to come into effect. However, when it does crypto investors and traders will be hit with a whopping 22% duty on profits and transactions.
This will effectively render the industry unfeasible in Thailand as there are plenty of other countries such as Singapore and Hong Kong that do not tax cryptos. Additionally, traders are more likely to take to peer to peer platforms such as LocalBitcoins to buy and sell without restraint or taxation within the country.
The Kingdom’s largest crypto exchange, BX Thailand, told Asia Times it is still awaiting clarity from the government on the new law.
“BX is relentlessly working to allocate all the information about tax capital gains 15% to our customers,” the exchange said in a statement to Asia Times. “But in the meantime, we’re still waiting for the Revenue Department and related departments to clarify the procedure of taxation. According to the Royal Act, customers need to collect and allocate their income and capital gain tax [and send this] to the Revenue Department … as currently BX is the one responsible for withholding the 15% tax.”
Despite the obvious moves by the Junta to clamp down on crypto, new exchanges are still emerging in Thailand. According to Bitcoin.com, Thai exchange Jibex recently opened its doors, offering BTC, ETH, BCH and LTC pairs to the THB initially. For its grand opening, Jibex is waiving its commission of 0.24% and no trading fee will be charged for 45 days ending on June 26.
It remains to be seen how the new tax structure will be implemented.
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