You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

April 5, 2024

Thailand Adopts Investment Incentive Policies for Software Development and Data Centers

Subscribe to Updates

On March 15, 2024, Thailand’s Board of Investment (BOI) updated its investment incentives for software development and data centers by issuing a regulation replacing the previous categories of software or platforms for digital services or content (category 8.1) and data centers (category 8.2.1).
The new and updated categories are detailed below.

Software and Platform Development

Under the new promotion policy, the BOI has made separate subcategories for “development” and “improvement” of software or platforms, each with its own set of incentives. The BOI is expected to clarify the characteristics of these two activities in a forthcoming announcement. Qualifying development activities are eligible for a corporate income tax (CIT) exemption for eight years (capped), while improvement activities are not eligible for any CIT exemption.

A number of adjustments have been made to the eligibility criteria for development of software and platforms for digital services or content. These include the following:

  • Salary expenditures for Thai information technology (IT) personnel hired temporarily after applying for investment promotion can now be included in the calculation of total salary expenditures for Thai IT personnel hired subsequent to applying for investment promotion. Previously, only salary expenditures for permanently employed personnel could be included in this figure. The minimum salary expenditures for each project remain unchanged at THB 1.5 million per year.
  • Similarly, salary expenditures for temporary hiring of Thai IT personnel can be included in calculating the actual expenditures in the year that the project would like to benefit from the CIT exemption.
  • Projects must commence operations within 12 months of the promotion certificate being issued. No extensions are allowed.
  • Projects are no longer allowed to extend the machinery importation period.

The other eligibility criteria for development of software and platforms for digital services or content remain unchanged.

Projects in the new BOI subcategory for improvement of software and platforms for digital services or content are not eligible for CIT exemption but can receive other incentives. To be eligible for these incentives, projects in this category must meet the following criteria:

  • Expenditures on salaries for Thai IT personnel hired (including temporarily) after applying for investment promotion must be at least THB 1.5 million per year.
  • Projects must propose a plan for improvement of the software, digital platform, or digital content to be sold or provided, as stipulated by the BOI.
  • Projects may not amend the category in which they benefit from investment promotion.
  • Projects must commence operations within 12 months of the promotion certificate being issued. No extensions are allowed.
  • Projects may not extend the machinery importation period.
  • Projects may not own land.

In addition, projects in this subcategory are notably allowed to utilize secondhand machinery or the project’s existing machinery, and are not subject to the common BOI prohibition on such use.

Data Centers

Qualifying data centers are still eligible for CIT exemption (no cap) for eight years, but there are minor updates to the eligibility criteria:

  • Projects must install an electrical system of at least two megawatts to support the power consumption of computer equipment.
  • Projects are no longer required to have an area of at least 3,000 square meters.
  • Projects must still obtain ISO/IEC 27001 certification before they can receive CIT exemption, but there is no longer an explicit requirement that they obtain the certification before the full operation deadline.

In addition, projects in the data center category are exempt from the general BOI requirement that projects benefiting from investment promotion obtain ISO 9000, ISO 14000, or other equivalent international certification.

For more details on BOI incentives for software and data center activities, or on any aspect of investment promotion in Thailand, please contact Athistha (Nop) Chitranukroh at [email protected], Nopparat Lalitkomon at [email protected], or Napassorn Lertussavavivat at [email protected].

Related Professionals

Industries

Technology

Location

RELATED INSIGHTS​ 

March 10, 2025
Thailand’s Securities and Exchange Commission (SEC) will officially add USD Coin (USDC) and Tether (USDT) to its list of approved cryptocurrencies for use in digital asset transactions on March 16, 2025. The addition is a significant move that expands Thailand’s digital asset market, aiming to enhance market flexibility and provide more payment options for investors and traders in Thailand’s digital asset ecosystem. Under the SEC regulations, digital asset operators, including digital token issuers, ICO portals, and digital asset exchanges, are only permitted to accept, conduct transactions with, and use “approved cryptocurrencies” as trading pairs. After the addition of USDC and USDT, the full list of approved cryptocurrencies will include: Bitcoin (BTC) Ethereum (ETH) Ripple (XRP) Stellar (XLM) Tether (USDT) USD Coin (USDC) Other cryptocurrencies used for testing programmable payments under the enhanced regulatory sandbox in accordance with the Bank of Thailand’s rules and conditions. For more information on these new additions, or on any aspect of digital assets and cryptocurrency in Thailand, please contact Kobkit Thienpreecha at [email protected], Pornpan Wichawut at [email protected], Napassorn Lertussavavivat at [email protected], or Rujaporn Paritsantik at [email protected].
Read More
February 28, 2025
Vietnam’s Decree No. 163/2024/ND-CP (Decree 163), which has been in full effect since January 1, 2025, provides crucial guidance on the implementation of Vietnam’s 2023 Telecom Law. Decree 163 replaced Decree No. 25/2011/ND-CP dated April 6, 2011 (Decree 25), which guided the implementation of the previous 2009 Telecom Law, and introduces many notable changes to the regulations on telecom service provision. Some key changes that will impact businesses engaged in the telecom sector in Vietnam are detailed below. 1. Classification of Telecom Services The classification of telecom services into “basic telecom services” and “value-added telecom services” has been retained, in alignment with Vietnam’s WTO commitments in the telecom sector. However, Decree 163 expands the scope of both categories, as follows: Basic telecom services: “Transmission services for machine-to-machine (M2M) communication” and “leasing services of all or part of the telecom network” are added. “Image transmission services” is changed to “transmission services for radio and television.” Value-added telecom services: “Data center services,” “cloud computing services,” and “basic telecom services over the internet” (also known as over-the-top (OTT) telecom services) are added. 2. M2M Communication Services Since M2M communication services are classified as basic telecom services, without exception, they are subject to the same regulatory framework. Specifically: Cross-border provision: M2M communication services provided across borders must be conducted through a commercial agreement with a Vietnamese telecom enterprise licensed to provide telecom services with an international communication scope. Onshore provision: Onshore M2M communication services will require a telecom license. 3. New Telecom Services (Data Center, Cloud, and OTT Telecom Services) The 2023 Telecom Law adopted a light-touch management approach for data center, cloud, and OTT telecom services by not requiring the same licensing as previously regulated value-added telecom services, but instead mandating registration or notification before service provision. Decree 163 offers clearer guidance
Read More
February 26, 2025
Tilleke & Gibbins has contributed the Vietnam chapter to Data Protection 2025, a comprehensive comparative guide in the Law Over Borders series from Global Legal Post. This Q&A-style resource offers detailed insights into data protection regulations across multiple jurisdictions, serving as an essential reference for organizations managing personal data in today’s global business environment. The Vietnam chapter examines the evolving data protection landscape in Vietnam, including analysis of relevant provisions in the Cybersecurity Law, the Law on Information Technology, and the upcoming Personal Data Protection Decree. The chapter addresses key aspects of data protection through the following topics: Regulatory framework: Analysis of national laws regulating personal data, jurisdictional scope, application to different entities, and regulated data processing activities. Data categories and processing: Overview of regulated personal data types, special categories requiring enhanced protection, and lawful processing requirements. Compliance requirements: Explanation of controller and processor obligations, technical and organizational measures, and data subject rights. Commercial communications and international transfers: Rules governing direct marketing and cross-border data flows. Regulatory oversight: Details on enforcement powers, investigation procedures, sanctions, and remedies for noncompliance. Tilleke & Gibbins also contributed the Thailand chapter to Data Protection 2025. Readers can access the complete Data Protection 2025 guide through Global Legal Post’s Law Over Borders platform.
Read More
February 26, 2025
Tilleke & Gibbins has contributed the Thailand chapter to Data Protection 2025, a newly published comparative guide from Global Legal Post’s Law Over Borders series. This comprehensive Q&A-style resource provides insights into data protection regulations across multiple jurisdictions worldwide, offering valuable guidance for businesses navigating the complex landscape of global data privacy requirements. The Thailand chapter offers a detailed analysis of the country’s data protection framework, with particular focus on the Personal Data Protection Act (PDPA) that came into full effect in 2022. The chapter addresses key aspects of data protection in Thailand through the following topics: Regulatory framework: National laws governing personal data, scope of application, territorial reach, and regulated operations. Data categories and protection: Types of personal data covered, special categories subject to enhanced protection, and processing requirements. Compliance obligations: Requirements for lawful processing, organizational responsibilities, and data subject rights. Marketing and cross-border considerations: Rules for commercial communications and international data transfers. Enforcement mechanisms: Regulatory powers, investigation procedures, sanctions, and remedies for noncompliance. Tilleke & Gibbins also contributed the Vietnam chapter to Data Protection 2025. Readers can access the complete Data Protection 2025 guide through Global Legal Post’s Law Over Borders platform.
Read More