The new blockchain system that aims to verify the accuracy of tax information and fasten tax refund processes will be implemented by the Thai Revenue department.
Blockchain to be Adapted in Thailand Revenue System
Thailand’s tax authority to deploy blockchain technology to improve tax collection. This was recently revealed by Ekniti Nitithanprapas, director-general of the Revenue Department. According to Nitithanprapas, the department will use blockchain technology and machine learning to improve revenue collection. Additionally, a new blockchain tax system also expects to speed up tax refund processes.
Meanwhile, blockchain technology will verify whether taxes are paying correctly and speed up tax refund, machine learning will study tax evasions. The Revenue authority believes the data from the machine learning algorithm will help Thailand effectively patch tax evasion loopholes.
According to the director general of the revenue department, blockchain deployment in the department is among the tax authorities top agenda. Thailand has taken an open-minded approach to blockchain technology and cryptocurrencies. The country taxes up to 15 percent capital gains tax on profits made from trading crypto.
Government Response to Blockchain and Cryptocurrency
Over the years, the Thai government had displayed a welcoming approach to cryptocurrencies and blockchain. Thailand developed a mutual co-existence system for cryptocurrency firms and other traditional businesses in the country. Moreover, taxes are levied on crypto-investment firms as well. A new tax law may see an additional 7% value-added tax on crypto investors.
Mid this year the country’s Security and Exchange Commission (SEC) announced a regulatory framework for ICOs (Initial Coin Offerings). The new framework that came into effect from July 16, 2018, requires digital token issuers to get registration with the SEC before putting their tokens up or sales.
However, Royal Decree from the Thai authority limits retail ICO investors only to 300,000 baht ($9,050). Meanwhile, only high net-worth investors, venture capital firms, private equity companies, and other institutional investors, are eligible to acquire limitless units of digital assets in ICOs.
SEC reported that more than 50 ICOs have already shown interest to obtain a license from them. Three of These firms followed the application process to register an ICO according to the new rule enacted by Thailand SEC. SEC explains what it takes for a new ICO to adopt acceptance officially list in Thailand.
“The ICO acceptance criteria may include due diligence and screening of funders from dishonest people. The source code of the smart contract will automatically enforce against the contract. After the sale, the SEC publishes a copy of the statement on the SEC website,” the regulator stated.
Meanwhile, more than 20 cryptocurrency exchanges have already expressed interest to officially operate in Thailand. Thereafter, among these exchanges are large and good exchanges such as Bithumb of South Korea. Moreover, cryptocurrency adoption and regulation are developing at a comparable pace in Thailand.