Thailand’s Board of Investment (BOI) announced the new tax exemptions on 19 May 2025.

Thailand’s Board of Investment (BOI) announced that it has approved a series of measures to support small and medium-sized enterprises (SMEs), along with revised incentives for investments in data centres, hosting, cloud services, and tourism promotion in second-tier provinces on 19 May 2025.

Promotion and support measures for local SMEs and entrepreneurs

This package of measures aims to encourage Thai entrepreneurs to enhance their potential and efficiency, increase their competitiveness amid intense competition and global trade tensions resulting from the impact of US trade policies, and support entrepreneurs involved in some of the most vulnerable sectors.

A key measure to support Thai entrepreneurs is an increase in the corporate income tax (CIT) benefits granted to BOI promoted SMEs which will now receive a five-year CIT exemption equal to as much as 100% of their investment in enhancing their capabilities and improvements, up from the previous three-year CIT exemption capped at 50% of investment.

Additionally, the BOI will suspend the promotion of certain types of businesses, including sectors that may face oversupply or have a negative environmental impact. Sectors affected entirely or in part by the suspension include solar cell and solar panel manufacturing, certain vehicle parts manufacturing (such as lead-acid batteries, accessories, decorations and equipment for vehicles that do not affect driving performance and safety), coil centers, long steel production, hot rolled steel production, and steel pipes.

The consideration of new project applications will also involve an increased focus on the production process, ensuring that “essential production processes” are happening in the country. This aims to promote value-added investment using modern technology in the manufacturing sector and the development of local supply chains.

Finally, the consideration of applications for investment promotion will include tighter criteria and screening regarding the hiring of foreign personnel, in terms of the appropriate proportion of Thai personnel for the manufacturing activities which hire more than 100 people and the foreign personnel’s minimum remuneration to promote investment that allows growth while promoting the development of the Thai workforce.

Revised requirements and benefits for data centre, data hosting, and cloud service projects

The Board approved a revision and improvement of the requirements and benefits for investments in data centers, data hosting and cloud services aimed to more appropriately reflect recent technological developments, to be more commensurate to the actual investment amount, and to ensure the projects contribute clearer benefits to Thailand’s economy, while helping workforce development and the appropriate management of natural and energy resources.

To get the highest level of tax benefits, CIT exemption for eight years, the projects will need to meet power usage effectiveness (PUE) standards, and offer data hosting using advanced computing capabilities such as graphic processing units (GPUs), etc. The tax benefits offered to other projects that do not match these requirements will be capped at five years.

Applicants for investment promotion in this sector will also be required to submit a plan detailing how the project will contribute to Thailand’s economy. The plan should include activities such as professional training, cooperation with local technical schools and universities in creating courses or conducting joint research and development projects, skill development programmes for Thai SME entrepreneurs, support to the strengthening of the country’s supply chains, etc. Implementation of the proposed plan will have to be completed before a project can exercise its rights to the CIT exemption.

As of the first quarter of this year, the BOI had already granted investment promotion benefits to 27 data centre projects, representing a combined investment of THB 240.6 billion. When including the THB 126.8 billion investment in a data hosting project which was approved earlier this year, the total of the approved investments in the data centre and data-hosting sector as of end-March amounted to THB 367.4 billion, and represented a combined IT Load of approximately 1,365 megawatts (MW).

Promotion of tourism businesses in 55 second-tier provinces

The meeting also approved measures to promote investment in tourism infrastructure businesses in the so-called 55 second-tier provinces. The measures are in line with the government’s policy to upgrade tourism infrastructure and develop new tourist attractions, promoting the distribution of tourists to less-visited areas and spreading the economic benefits of tourism nationwide.

Investment in tourism businesses including large-scale quality tourist attractions, theme parks, Thai cultural centers, handicraft centers, museums, open zoos, international exhibition centers, large convention halls, cruise terminals, motor racing stadiums, cable cars and electric trams for tourism in the 55 designated provinces will receive eight years CIT exemption privileges, increased from five years previously. Investments in the hotel business in these provinces will receive five five-year CIT exemption, compared to the three years granted previously.