By CCN.com: Thai startups raising funds by issuing digitized equities/stocks pay more taxes than an average business, according to Prinn Panitchpakdi.
The governor of the Stock Exchange of Thailand (SET) said initial coin offering (ICO) startups typically pay 7 percent in value-added (VAT) and a 20 percent in corporate tax. At the same time, the Thai tax authorities have exempted technology giants like Facebook, Google, and Line from paying VAT. Panitchpakdi believed that such an unleveled field was choking Thailand’s startup ecosystem, for they no longer could experiment freely under a stiffer regulatory and tax framework.
“In Singapore, such a digital asset law does not exist. The Singaporean government allows startups to innovate products before introducing regulations,” he added. “In Singapore, the government permits the private sector to use public data. Grab was able to launch its innovative ride-sharing service, known as Grab Bus. [Yet] Grab is still illegal in Thailand.”
Panitchpakdi stretched his argument by including the Thailand tourism industry. The governor feared the presence of tax-exempted global players had choked the growth of similar services that were operating out of Thailand. A typical Thai tourism startup was shedding more money in taxes-per-sale than a Booking.com or Agoda, which was eventually limiting its expansion.
“Why are large companies exempt from taxation? How can we allow this to happen?” he questioned.
Thailand, like any other developing country, is all about attracting investments and creating perfectly squared nine-to-five jobs for its people. Multinationals, at the same time, look for jurisdictions that put the minimum tax burden on them. The process eventually turns into a bargain deal, where countries like Thailand willfully bend tax rules to attract multinationals.
These bigger corporates also take huge benefits by setting up their bases in developing countries. They typically manipulate accounts to…