On 08 Nov 2022, Thailand VAT Royal Decree (No 759) was gazetted, entitling Thailand operators of Data Center businesses to apply for VAT exemption.

This Tax Insight summarizes the entitlement under Royal Decree (No 759).

Data Center Businesses

A Data Center is one the business operations under the National Competitive Enhancement of Targeted Industries Act BE 2560 the Thailand Government is promoting for attracting investment in.

The VAT Exemption under Royal Decree (No 759)

For enhancing the attractiveness of investments in Thailand Data Centers, Royal Decree (No 759) has been issued for entitling operators of Data Centers to a VAT exemption incentive, as follows:

Applicability

Applications during the 5 years period of 09 Nov 2022 to 08 Nov 2027.

VAT Exemption Incentive

The VAT exemption incentive under the RD (No 759) is for:

1. The provision of server space and equipment for the storing, processing and connecting of electronic data; and

2. The provision of support services for the services under 1, including:

• Data backup services and disaster recovery services;
• Connection services to internet or cloud services providers; and
• System management and security services.

Rules, Procedures and Conditions

A Data Center business operator shall:

1. File an application for the VAT exemption to the Thailand Revenue Dept within 5 years from the date this Royal Decree enters into force,
2. Be a corporate entity established under the Thai law,
3. Be a VAT registrant,
4. Operate a Data Center business that is a promoted business under the law governing investment promotion or the law governing target industries,
5. Comply with the Revenue Department's additional rules, procedures and conditions, and
6. Be entitled to the exemption from VAT from the day following the receipt of the Revenue Department's notice of approval.

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