Thailand: Government dangles 50% tax cut for manufacturers fleeing China

• Thailand has announced a package of incentives, including a 50% tax cut, for companies to relocate production to the slowing south-east Asian economy from China amid the Sino-American trade war.
• To qualify for the incentives, companies must apply in 2020 for approval to invest THB1bn (USD32.7mn) or more in the country and carry out the investment by 2021. Approved investors will see their corporate tax obligations reduced by half for five years.
• The incentives show Thailand jockeying for foreign investment against neighbours such as Vietnam as the country seeks to move its manufacturing sector into higher-value activities.
• As many as 48 multinationals including US chipmaker Western Digital are considering relocating production to south-east Asia from China, Thailand’s Office of the National Economic and Social Development Council says.
• Ten of these companies are strong candidates for investment in Thailand, according to the office.
• Beyond offering a tax cut, the government also will create a single portal that advises companies on their applications and allows them to file.
• To encourage training of skilled workers, tax breaks will be offered to offset the cost of building training centres and providing employee development programmes. Labour rules will be eased to help skilled foreigners to work in Thailand.

External Link : https://www.ft.com/content/da4b4864-d50d-11e9-8367-807ebd53ab77