Thailand to Pass Two New Cryptocurrency Laws
Thai regulators have reportedly agreed to enact two separate laws on cryptocurrencies and initial coin offerings. They will regulate crypto businesses, the purchase and sale of cryptocurrencies, as well as their taxation.
Two Laws Being Drafted
Mr. Apisak Tantivorawong.
The Thai Minister of Finance, Mr. Apisak Tantivorawong, said on Thursday that the government is preparing to announce the regulations for cryptocurrencies and initial coin offerings (ICOs) by the end of this month, Channel 7 news reported.
After the cabinet’s meeting, the country’s deputy prime minister, Mr. Somkid Jatusripitak, explained that two laws are being drafted, according to Thai Rath newspaper.
The first is the Act on Digital Asset Businesses. It requires the registration and know-your-customer (KYC) compliance of cryptocurrency operators including agents, dealers, and brokers, the news outlet detailed. It also imposes penalties and remedies for violations.
The second is the revision of the country’s Revenue Code which concerns taxation related to cryptocurrencies and ICOs, the publication described.
Regulating Crypto Businesses & Taxation
According to Thai Rath, cryptocurrency and ICO businesses such as intermediaries will be required to identify themselves and the sources of crypto investment funds in order to prevent money laundering. These businesses will be obligated to provide transaction information as well as the names of buyers and sellers to the Anti-Money Laundering (AML) Office. The law also puts the Securities and Exchange Commission of Thailand (SEC) in charge of the regulations. The news outlet elaborated:
Thai private companies that have already issued an ICO must comply with the law within 6 months.
Moreover, Mr. Apisak has ordered the Thai Revenue Department to collect 7% VAT and 15% withholding tax on cryptocurrencies and ICOs, the publication noted, adding that taxpayers can combine their crypto tax liabilities with their annual income.
Central Bank Will Not Change Stance
The Bank of Thailand (BOT) said that it will not change its stance regarding cryptocurrencies and ICOs, the news outlet detailed. In February, the central bank prohibited financial institutions from five key cryptocurrency activities, which will remain in effect even after the regulations are in force.
Following the BOT’s prohibition, Bangkok Bank subsequently terminated the accounts of a local cryptocurrency exchange.
Another major bank, Krungthai Bank, soon followed suit and terminated the accounts of local crypto exchanges with them. Mr. Piyong Sriwanich, the bank’s president, was quoted by Thai Rath on Thursday declaring that his bank does not support and will not deal with cryptocurrencies in any way. Furthermore, he emphasized that if anyone opens “a deposit account with the bank and invests money in digital currency, the bank will close the account immediately.”