Phuket is a magnet for tourism. With many attractions, the tourism industry in Phuket is always hot, and BOI’s (Thailand’s Board of Investment) promotion of tourism businesses is always mutually beneficial to investments. This article provides additional information to BOI’s website and contains all types of tour businesses that are Phuket-based (Thailand-based) and are applicable for BOI promotion. Whether you are a business startup or you are aiming at expanding your business into Phuket or Thailand, The BOI promotion gives several advantages to your investment.

Tourism Industry Categories by BOI

Tourism Promotion Services

  • Ferry services or Tour boat services or renting.
  • Tour boat port services.
  • Amusement parks with a minimum investment of 500 million baht.
  • Thai cultural or craft centres with a minimum investment of 30 million baht.
  • Open zoo with a minimum investment of 500 million baht.
  • Museum with a minimum investment of 30 million baht.
  • Race tracks with the Federation International de L’Automobile (FIA) or Federation International de Motocyclisme (FIM) standard.
  • Cable cars with a minimum investment capital of 100 million baht.
  • Cruise terminal.
  • Man-made attractions with a minimum investment capital of 100 million baht.

Activities to Support Tourism

  • Hotels with a minimum of 100 rooms and a minimum investment of 2 million baht per room. Or a hotel with less than 100 rooms with a minimum investment of 500 million baht.
  • Convention halls with a minimum convention area of 4,000 square.
  • International exhibition centres with a minimum indoor area of 25,000 square meters.

Basic Benefits under BOI Promotions

All tourism business types have a 5-year corporate income tax (CIT) exemption equal to 100% of investment; the investment excludes the cost of land and working capital. The CIT exemption is combined with the exemption of import duty on machinery and import duty on raw materials for production for export, if any. For some businesses, the CIT exemption is not limited to capital investment, but most of them are in other business categories, not tourism businesses.

However, for the hotel business, the CIT exemption depends on location. The provinces famous for tourism (Krabi, Bangkok, Kanchanaburi, Chachoengsao, Khon Kaen, Chon Buri, Chiang Mai, Nakhon Pathom, Nakhon Ratchasima, Nonthaburi, Pathum Thani, Prachuab Khiri Khan, Phra Nakhon Si Ayutthaya, Phang-nga, Phetchaburi, Phuket, Rayong, Songkhla, Samut Prakan, Samut Sakhon, Sarabuti, and Surat Thani) have zero-year CIT exemption but grant rights to craftsmen and freehold land. In the hotel business in other locations, the CIT exemption is 4 years, together with the exemption of import duty on machinery and import duty on raw materials for production for export, if any. if any.

Investment Capital

Some tourism businesses don’t have a minimum investment; some do! All investment capital investments mentioned above exclude the cost of land and working capital but include the costs of construction as below:

  • In the case of own construction, it includes the costs of the construction of office buildings, infrastructure, facilities, and modifications.

  • In the case of acquiring or using existing buildings, including the value specified in the purchase agreement or the book value of the company at the latest accounting period.

  • In the case of an office or factory rental, the rent specified in the lease agreement must exceed three years.

For the hotel, convention hall, and international exhibition centre business, construction costs, decoration costs, furniture and equipment costs, and necessary system costs.

Relevant Law

All tourism businesses are subject to relevant laws, although BOI didn’t mention them at the time of application. For example, amusement parks, hotels, open zoos, cable cars, and man-made attractions must abide by environmental impact assessment (EIA) and building control. Ferry services, tour boats, and boat port services must abide by marina rules and regulations, etc.

Qualifications of Applicant

All the BOI promotions for tourism businesses are only for a Thai limited company, Thai cooperative, or Thai foundation, not a private individual. However, if those juristic persons have not yet registered, an application for the promotion may be made by an individual, and a juristic person must be established within 6 months before the application for an investment promotion certificate.

If you are concerned about how to legally have full control over your Thai company with 51% Thai shareholders, please visit our blog. You will find out easily.

Number of Promotion Certificates

One company may have more than one promotion certificate and request a combination of two or more promotional certificates later for management benefits or other reasons. However, each promotion should be fully operational and complete the CIT exemption. If not, all CIT exemptions will be waived, equal to the project with the least benefits.

BOI Certificates Not Transferable

When the promoted person transfers or sells the promoted business to others. The promotion certificate can be used for 3 months from the date of business transfer or sale. The buyer must apply for a new promotion certificate; the CIT exemption and other benefits will be the remaining benefits of the seller; nevertheless, taking over the company is an option!

In conclusion, whether your business or not, business location in Phuket or another province in Thailand, BOI promotion is an advantage over your investment; it saves a big amount of tax payment, together with other advantages of business performance. Learn more about the advantages of BOI promotion.

If you are in need of a business lawyer, whether you are a startup or business expand into the Phuket tourism industry. We Can Help.