Cancellation of ROH, IHQ and ITC Tax Incentives

Earlier this year, the Thai Revenue Department (TRD) issued a new hub regime, the International Business Center (IBC). At that time, the TRD announced that existing beneficiaries of the Regional Operating Headquarters (ROH) and International Headquarters (IHQ) regimes would be able to continue benefiting from the associated incentives until the expiry date. However, on March 26, 2019, the Thai Cabinet approved a Royal Decree cancelling all tax incentives provided under the IHQ regime with effect from June 1, 2019 onwards for corporate income tax incentives and January 1, 2020 for personal income tax incentives. While we assume that this was likely due to the pressure from the OECD (as a result of the Base Erosion and Profit Shifting (BEPS) project), this came without any prior announcement from the government.

Specifically, the following benefits will be cancelled for the IHQ regime:

  • Cancellation of the Personal Income Tax (PIT) rate reduction applicable to foreigners from January 1, 2020 onwards;
  • Cancellation of the Corporate Income Tax (CIT) rate reduction and exemption from CIT on the income from provision of services to affiliated companies (as well as interest income, royalties income and dividend income received from affiliated companies) from June 1, 2019; and
  • Cancellation of withholding tax (WHT) exemption on dividends paid by the IHQ to foreign shareholders, except for dividends paid out of profits derived before 1 June 2019 provided that the dividends are paid by December 31, 2020.

More information about the cancellation of IHQ tax benefits can be found on the KPMG website here or the DFDL website here.

At this stage, it is not possible to apply for the IBC.  Based on our discussions with the TRD, online applications for the new regime should open in April 2019 (most likely after the Songkran holidays), which, in practice, leaves the current beneficiaries with a very short period of time to prepare and submit their applications for conversion to the IBC before June 1, 2019.  The TRD is also promising to release soon (unclear when exactly) supplementary laws and regulations on practical features of the new regime which have not been released yet.

AMCHAM is working actively on our members' behalf to advocate for their concerns on this issue.  If your business has been affected, please contact Executive Director Heidi Gallant at or Director of Government Affairs Tomwit Jarnson at

When we have more clarification on how these changes will be implemented in practice, we will also plan an event to brief members as well as update members via our website and other communication channels.

In the meanwhile, please contact your tax adviser or the Tax Committee chairpersons below in case you have any questions.

AMCHAM Tax Committee

The AMCHAM Tax Committee aims to provide an effective forum to discuss tax matters relevant to members of the American Chamber of Commerce In Thailand and inform members of changes & requirements on US tax matters. Read more...

John Andes, KPMG in Thailand

Jonathan Blaine

Matthew Stevens, U.S. Global Tax Plan

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