After being in effect for more than 35 years, the Thailand-Singapore tax treaty is undergoing a major revamp.
Representatives of both countries recently negotiated changes to the treaty in Singapore. Although it will take a while before the new version is completed and comes into force, it is quite amazing to learn from the draft that Thailand has offered a number of tax benefits never granted in any tax treaty before. For example:
- The existing treaty stipulates that a building site, construction, installation or assembly will be considered a permanent establishment (PE) for tax purposes if it has been in existence for more than six months. The new version extends the period to 12 months, the longest ever agreed by Thailand. No other country, not even Japan, China or the United States, enjoys this privilege.
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