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How ASEAN Tackles the U.S.-Sino Trade War | Read More

Jan 10, 2020
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How ASEAN Tackles the U.S.-Sino Trade War | Read More

3How ASEAN Tackles the U.S.-Sino Trade War

To respond to the

U.S. Sino trade war

, members of the Association of Southeast Asian Nations (ASEAN) have introduced incentive programs to attract foreign investors. These incentives mostly include tax breaks and initiatives to improve the investment climate.

Thailand Plus

Thailand Plus

is a stimulus package that covers seven key points, including the introduction of new tax incentives and deductions. It allows companies to apply for further reductions if they invest at least 1 billion Bhat (US$32 million) and apply for the incentive before 2020. Additionally, the government will amend laws regulating foreign business activities and develop special investment zones for companies from South Korea, Japan, China, and the U.S.

The Philippines’ CITIRA

The

Corporate Income Tax and Incentives Rationalization Act (CITIRA)

will gradually reduce CIT from 30 percent to 20 percent over ten years. The Act is part of the government’s

Comprehensive Tax Reform Package program

. It aims to increase foreign investment, stimulate job growth, and enable domestic small and medium-sized enterprises (SMEs) to be more regionally competitive.

Exports News

 


Malaysia’s 2020 budget

Malaysia’s 2020 budget

introduced tax incentives and grants to attract investments from multinational companies, particularly from China. The target of the stimuli is Fortune 500 companies that invest at least 5 billion Ringgits (US$1.1 billion) into Malaysia. Moreover, Malaysia will establish a specific channel to cater to Chinese investors and has set up a panel to fast-track investments for U.S. and Chinese businesses looking to move operations out of China.

Indonesia’s tax incentives

Indonesia introduced GR 45/2019, laying out

tax incentives

for businesses that invest in specific industries. GR 45/2019 can be particularly advantageous for foreign companies looking to establish a manufacturing base in Indonesia for areas such as textiles, commodities, and services.

Vietnam

The Vietnamese government issued a decree providing science and technology enterprises with preferential treatment ranging from corporate tax cuts and exemptions to credit incentives and reductions in land and water surface lease fees. Besides these stimuli, the government is prioritizing investments in IT with labor and tax incentives.

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