Thailand: Guidance on VAT exemption granted to promote data center businesses
The guidance includes the following details, conditions, and procedures.
The guidance includes the following details, conditions, and procedures.
The Director-General of the Revenue Department on 15 March 2023 issued Notification No. 251 to provide guidance on the value added tax (VAT) exemption granted to promote data center businesses that became effective 9 November 2022. Read TaxNewsFlash
The guidance includes the following details, conditions, and procedures in relation to the exemption:
Definition of a data center business
“Data center businesses” includes the provision of the following services:
- Server space and related devices for use in data storage and data processing as well as electronic data connections via internet network
- Support services such as:
- Data back-up services for prevention of problems that may cause data damages
- Network connection services for internet or cloud service providers
- System management and information technology security services
Requirement for the data center business operator
To qualify for the exemption, the data center business operator must be a company or juristic partnership established under Thai law, a VAT registrant, and granted with a promotion in data center business under the investment promotion law or the law governing the enhancement of national competitiveness for targeted industries, or other laws as prescribed by the Director-General of the Revenue Department. In addition, the operator must not have claimed input VAT related to the data center business service against any output VAT liability in the VAT return during the past three years prior to the tax month that the VAT exemption request is submitted. However, if input VAT relating to the data center business was claimed, the operators may still qualify for the exemption if they submit an additional/amended filing to exclude the data center related input VAT from the VAT return, as well as paying applicable penalties, surcharges, and fines for the previous three years, prior to submitting the VAT exemption request.
Read an April 2023 report [PDF 240 KB] prepared by the KPMG member firm in Thailand
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