Americans question new Business Act

Americans question new Business Act - Bangkok Post, August 25, 2007

Farewell to the subcontract technique for foreign entities - Bangkok Post, August 28, 2007
The atmosphere is deteriorating for foreign enterprises doing business in Thailand. Developments that have sapped confidence include the 30% reserve requirement imposed by the Bank of Thailand in December to maintain baht stability, controversy over the amendment of the Foreign Business Act to eliminate the use of nominees, and the shocking attempt by the National Legislative Assembly to adopt a harsher approach by including economic interest and foreign management control to test foreign ownership. Thankfully, the draft has been withdrawn temporarily. In any case, it is getting more difficult for foreign entities to survive when it comes to tax...
Just recently, the Revenue Department set a guideline stating that, where a foreign contractor subcontracted work that it undertook from a customer in Thailand, even though it did not carry out any activity in Thailand by itself, it was deemed to carry on the business in Thailand if the activities of the subcontractor took place in Thailand. As a result, the foreign contractor in such a situation was obliged to pay corporate income tax...

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