Data Centers in Thailand will now be exempted from VAT.
Thailand’s cabinet has passed the VAT exemption in principle in the draft Royal Decree. Though exemption has been granted, VAT is charged at 7 percent currently.
Thailand’s Finance Minister, Arkhom Termpittayapaisith believes that minimized tax rate would result in more and more investment in hyper-scale data centers within Thailand.
Google Cloud’s new data center in Thailand will likely be exempted from VAT under the new grant.
Lavaron Sangsnit, Revenue Department’s director general said, the Revenue Department of the Ministry of Finance has identified the significance of the data center industry and data hosting services which are expanding at a rapid scale.
According to the Royal Decree, VAT will be exempt under the following services and circumstances:
(a) Services for servers or related equipment for storing, processing, and connecting electronic data via the Internet; or
(b) Disaster recovery sites, connection with Internet service providers or cloud service providers, and systems management and securities services as supporting services of the services in item (a).
(c) The registrant applying for the VAT exemption must also be a data center business operator with qualifications and must comply with all rules, procedures, and conditions prescribed by the Director-General of the Revenue Department.
(d) The application must be filed within five years after the decree is effective.
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