While owning a crypto in some countries is illegal, in Thailand owning a cryptocurrency is the same as owning a house with the difference that the former is a digital asset rather than a physical asset. The cabinet is set to give the SEC powers to govern and legalize cryptocurrencies as an asset in the country. This is to be done through a popular vote which will see those investing in cryptocurrencies taxed. The royal decree will see a cryptocurrency grouped as an asset and not a currency.
If the cabinet will honour the request of the Revenue Department, the new revenue code will be amended to include a 10% capital gains tax which will enable the department to tax profits from cryptocurrency trading. As reported by the Bangkok Post, the decree will be the government’s way to have a say in ICOs and the digital money platform.
In his remarks last week, Somkid Jatusripitak, deputy prime minister, said that the government will issue a new law for the regulation of cryptocurrencies and initial coin offerings. “Virtual coins will be classified as digital assets, not currency, so the royal decree will empower the Securities and Exchange Commission (SEC) to regulate all aspects of virtual coins.” Reported the Bangkok Post.
Rapee sucharitakul, the SEC secretary-general, noted that the regulations will be a big boost in the standardization of information disclosure and reporting of transactions. The objectives, security and how the proceeds from ICOs are utilized will receive scrutiny from the SEC. Cryptocurrency investor protection will fall under the jurisdictions of the new law.
According to prof Arnat, Thammasat Business school, “traders could seek to engage in cryptocurrency trading overseas, but they could be subject to money laundering liability once they repatriate such gains to Thailand… profits from cryptocurrency trading are likely to be parked abroad by wealthy investors.”
Arnat observed that this will be a clever way for the government to generate revenue and at the same time cool off the rising speculation on cryptocurrency. The Bank of Thailand and the Securities and Exchange Commission will have the supervisory role over the digital assets.
Once the royal decree is accepted today, it will start being enforced before the end of this month.
Is the government of Thailand justified to classify and legalize cryptocurrency as an asset rather than a currency?
Let us know in the comments section.