The regulatory and surveillance environment is likely to become more stringent for crypto traders in Thailand.
As per a report from the Bangkok Post, crypto profits will attract a 15% capital gains tax from the current year. The initiative will be applicable to digital asset investors and miners but will exclude exchanges. The capital gains tax is levied on the profits made by selling a non-inventory asset.
The media report cited a Finance Ministry note that recommends investors to accurately calculate and report their profit from cryptocurrencies in the annual tax filing in 2022.
The coverage, based on information provided by an unidentified Finance Ministry official, claimed that the Revenue Department had taken note of the significant growth of the crypto market, both in size and value, in 2021 and intends to strengthen its surveillance.
However, there is no clarity on how the taxes will be assessed and paid. Industry analysts think there are two options. One, the individuals and mining operators can calculate the profits and declare them along with tax payments during annual tax filing. Two, the government might ask crypto exchanges to deduct the taxes at the source.
The second option could impact the crypto trade adversely, which has flourished in recent years in an environment marked by a lack of regulatory and taxation frameworks.
The report quoted Akalarp Yimwilai, co-founder and CEO of Zipmex, who said that calculating profit and loss for tax assessment is not easy given the fluctuating exchange rate of the dollar.
“As an exchange provider, Zipmex has been developing a system to help our customers calculate profits and losses, but it’s challenging,” he commented.
While the Kingdom’s tourism industry pins its hopes on the rapid growth of the crypto space to boost its revival, the government and the central bank have maintained a rigid posture, marked by crackdowns.
Most of the crypto exchanges in Thailand are either operated by leading banks or wealthy business people. For example, Thailand’s oldest bank Siam Commercial Bank bought out a 51% stake in the country’s largest digital assets exchange, Bitkub, in November last year.
Another important crypto exchange ZipMex Thailand secured $40 million in funding from the nation’s fifth-largest lender Bank of Ayudhya.
Commenting on the taxation topic, Yimwilai added:
“If the Revenue Department really has such an advanced data analytics system that it can precisely calculate gains from cryptocurrencies, it would be a great benefit to share it with the industry.”