EEC Office ready to propose investment perks until 2022
Investment may hit B400bn in 2021
The Eastern Economic Corridor (EEC) Office seems prepared to propose the government extend promotional privileges for investment in the EEC area until 2022 in a bid to sustain investment momentum.
According to EEC Office secretary-general Kanit Sangsubhan, his office plans to declare 2021 as "an investment year in EEC" after the government began four key infrastructure development projects in the area.
The four key infrastructure projects are a high-speed rail linking Suvarnabhumi, Don Mueang and U-tapao airports; a renovation of U-tapao airport; Map Ta Put industrial port phase 3 and Laem Chabang port phase 3.
"To maintain investment momentum, we see the extension of promotional privileges due to end by late 2021 as essential," said Mr Kanit.
The EEC is part of the government's strategy to move Thailand towards a high-tech economy.
The area spans a combined 30,000 rai in the provinces of Chon Buri, Rayong and Chachoengsao to accommodate investment in the government's targeted industries focusing largely on advanced technology.
The government offers a raft of promotional privileges for investment projects in EEC, including standard tax holidays for 5-10 years depending on investment categories; corporate income tax exemption for an additional two years and a 50% corporate tax reduction for three years for investment projects engaged in human resource development.
Projects which are located in EEC of digital, EEC of innovation, EEC of aviation city and EEC of a medical centre, and promoted industrial zones are eligible for tax holidays for an additional one-year period and a 50% corporate tax reduction for two years.
Apart from tax incentives, the government has also offered additional privileges such as exemption of import duties on machinery. The exemptions include import duties on raw materials for production, R&D and a 17% personal income tax deduction for high-ranking executives, experts and researchers who work for companies investing in targeted industries and headquartered in the EEC. This offer also applies to executives' parents, spouses and children.
Foreign executives working at their headquarters or international trading companies in the EEC are subjected to 15% personal income tax.
According to Mr Kanit, the EEC Office is also accelerating related agencies and private companies in developing basic infrastructure for data management in order to support the public and private sectors collecting information in the cloud, which will then be developed as data centre or "common data lake".
Businesses and startups would be able to use the common data lake to upgrade their businesses, such as for e-commerce, tourism, public health and medical services, according to Mr Kanit.
The government is optimistic investment in the EEC area can reach 400 billion baht in 2021, driven both by private investment and infrastructure development.
Of the total, 300 billion baht is expected to be generated by private investment, while 100 billion baht would stem from four key infrastructure projects.
For the first 11 months, 387 projects were filed for investment applications at the EEC, down from 415 projects during the same period last year.
The value of the projects recorded during the first 11 months of 2020 fell to 128 billion baht from 199 billion during the same period last year.
Investment applications in the EEC accounted for 41% of all applications filed through the Board of Investment (BoI).
Investment in the 10 targeted industries in the EEC amounted to 69.9 billion baht, accounting for 59% of the total investment.
Of the total investment, the old or first S-curve industries (agriculture and food processing, automotive and parts, electrical appliances and electronics, petrochemical and chemicals and tourism) contributed a combined 57.9 billion baht.
The new S-curve industries (aviation and logistics, biofuels and biochemicals, digital, medical services and robotics) accounted for 12 billion baht.