How does the global minimum tax (Pillar Two) affect Chinese-invested companies in Thailand and BOI incentives?
1. Who is affected
Thailand has legislated the global minimum tax for financial years beginning on or after 1 January 2025. It applies to Thai constituent entities of multinational groups whose consolidated revenue reaches the EUR 750 million threshold.
| Type of company | Affected? |
|---|
| Independent Chinese-invested SMEs | Generally not |
| Thai subsidiaries of large Chinese groups (including listed companies) whose consolidated revenue reaches the threshold | Needs assessment; may be affected |
| Large-group subsidiaries with BOI exemptions and very low actual tax | Most directly affected |
2. Impact on BOI incentives
BOI corporate income tax exemptions bring the Thai subsidiary's effective tax rate below 15%;
For in-scope groups, the shortfall below 15% is topped up, collected locally through Thailand's domestic minimum top-up tax;
As a result, the real value of BOI income tax incentives is reduced for these groups, while import duty relief on machinery and raw materials, foreign ownership, land and foreign staff privileges are unaffected;
The BOI is studying supporting measures for affected companies; follow official announcements.
So when large groups assess whether BOI is worth applying for, the global minimum tax should be factored in (see Is Applying for BOI Worth It? One Table to Work It Out).
3. What affected groups should do
Check scope: based on group consolidated revenue and constituent entities.
Calculate the effective tax rate: adjust the Thai entity's income and taxes under the global minimum tax rules and calculate the ETR and top-up tax.
Connect with head office data: much of the data comes from group level and must be consistent.
File on time: Thailand has signed the GloBE information exchange agreement (GloBE MCAA), with the first exchange planned by December 2027.
4. Basis and scope of service
Basis: Thailand's global minimum tax (top-up tax) legislation; the OECD Global Anti-Base Erosion (GloBE) rules; the Revenue Department's 15 September 2026 press release on signing the GloBE MCAA. The rules and Thai implementing details are still evolving; the law and official guidance in force at the time of service apply.
Related services: Global Minimum Tax (Pillar Two) | BOI Investment Promotion Application
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