Thailand plans to cut customs duties on 326 capital goods | Norton Rose Fulbright
THAILAND ANNOUNCED PLANS TO CUT CUSTOMS DUTIES ON 326 CAPITAL GOODS to 3% from current rates of from 5% to 20%. The government also said it would allow companies to use the double-declining balance method to depreciate plant and machinery. The new depreciation only applies to assets purchased after the new law comes into effect. The announcement was made on August 10 only days after the World Bank told Thailand that it must reduce both import tariffs and corporate income taxes.
Meanwhile, the Board of Investment is working on revamping existing tax incentives for foreign investors. A new investment incentive package is expected in November.
COLOMBIA ruled that technical services that an offshore company performs for a Colombian company are not subject to value-added taxes if the services are performed offshore. The value-added tax is ordinarily 16%.
It would be a good idea to put these services in a separate contract to avoid confusion.
PENNSYLVANIA enacted a new tax credit to encourage projects to make synthetic fuels from coal.
A synthetic fuel is a fuel that differs chemically from the underlying coal used as feedstock. The tax credit is 15% of the capital cost of the project. The credit is claimed when the project is placed in service and applies only to new projects and then only to equipment that is acquired or constructed during the period 2000 through 2012. Total credits for all projects under the program cannot exceed $18 million a year. The developer must sign a contract with the state promising to repay part of the subsidy over time.
BRAZIL TERMINATED ITS TAX TREATY WITH PORTUGAL, effective next January 1. The Brazilian revenue minister said that the treaty was being used to support tax evasion by routing investments into Brazil through Madeira island.
INDONESIA is expected in November to unveil a new set of tax incentives to lure foreign investors.