BOI CIT exemption already used up? A path back to new incentives

01Who this route is actually for

"Our BOI CIT holiday already ran out — are we out of options?" is a question many Chinese-invested manufacturers who have been operating in Thailand for a few years eventually ask. There is still a route. Announcement 15/2565 is built specifically for existing enterprises — whether previously BOI-promoted or not — as long as the CIT exemption/reduction has already ended, or the project never had one, and the activity category the applicant falls under is still one the Board of Investment currently promotes. Existing businesses shut out of the "no new-project promotion" track (a restriction that has recently appeared in narrow slices of a few industries — parts of steel, and aluminium casting from externally sourced scrap) can use this same route without being bound by the new-project category restriction.

02Five sub-measures, and they are not interchangeable

The measure has five sub-measures, each covering a different type of upgrade, and the incentive level and attached conditions differ — picking the wrong one stalls the filing later on:

• Equipment upgrade and automation — introducing automation systems or robotics to raise efficiency: machinery import duty can be waived, and CIT is exempt for 3 years at 50% of the upgrade investment, rising to 100% if the automation equipment has a genuine link to domestic automation manufacturing.
• Digital technology adoption — system integration and connectivity, or big data and analytics, or linking into government online systems; this sub-measure carries no machinery duty exemption (it is not about buying machinery), while the CIT exemption is the same 3 years at 50%.
• Moving toward Industry 4.0 — requires an upgrade plan endorsed by Thailand's National Science and Technology Development Agency (NSTDA), the only one of the five that needs sign-off from an outside body; build the NSTDA review cycle into your timeline.
• Energy saving, renewable energy, or reduced environmental impact — machinery duty exemption plus CIT exemption for 3 years at 50%; the emissions-reduction option additionally requires registration and certification with Thailand's Greenhouse Gas Management Organization (TGO).
• Moving toward international sustainability standards — machinery duty exemption plus CIT exemption for 3 years at 50%; the published examples currently skew toward agriculture and food certifications (GAP, FSC, ISO 22000), and whether common manufacturing standards such as ISO 14001/45001/50001 fall within this option needs confirming with the office.

The entry threshold — an upgrade investment of at least THB 1 million (excluding land and working capital) — is common to all five, and whichever option you take, the upgrade must be completed within 3 years of the promotion certificate date.

03Three conditions easy to overlook

The parent announcement only says applications follow "standards set by the office" — the actual standards sit in two separate official clarification letters. These three conditions are the ones most often missed, and they determine whether a filing can go forward at all: 1) the application must be submitted before the machinery or technology is purchased — judged by the import date or the asset-acquisition date. Buy first and apply later, and that investment simply does not count — there is no fix after the fact. When a client asks "we upgraded our line last year, can we still file," the answer is usually no — the upgrade plan has to be brought in at the procurement-decision stage. 2) the machinery being upgraded must be new — used equipment does not qualify. 3) an existing promoted project must have already commenced operations, on top of having its CIT exemption already ended — so qualifying for this route means checking two things, not one: has the exemption period ended, and has the operating licence already been granted.

04Two economic tests — this is not a paperwork exercise

The automation and the energy/environment sub-measures each carry a measurable, verifiable threshold set out in the official clarification letters — a written explanation alone does not clear it:

• Automation — requires submitting unit production/service cost data from before and after the upgrade, showing the unit cost has actually gone down. The baseline cost figures need to be locked in before the upgrade starts — trying to reconstruct a credible before/after comparison after the fact does not work.
• Energy/environment — the test compares the value of energy saved over 5 years against the value of the CIT exempted over 3 years, and it must not fall short. The two periods are deliberately mismatched: it is not "a year of savings against a year of tax," but 5 years of savings measured against 3 years of tax — a wider margin than it first appears, but the savings have to be real. Plan by estimating the 5-year energy savings first, then work backward to what CIT exemption that supports — not the other way around.

05The emissions-reduction option: one certification, two uses

The emissions-reduction option under the energy sub-measure requires registering and certifying emissions with the Greenhouse Gas Management Organization (TGO) before it can be filed. For Chinese-invested clients already facing group-level ESG reporting or EU CBAM-style carbon disclosure requirements, this is worth noting — the same TGO certification can serve both the group's carbon reporting and the BOI tax incentive, one certification effort covering two purposes instead of running two separate certification processes.

Which of the five sub-measures fits, whether the economic test can be met, and whether both the operating-licence and exemption-end conditions are already in place all need to be checked against the project's current promotion certificate terms and the notices in force — the specific thresholds and incentive details are amended from time to time. We generally recommend a review with our advisers before the upgrade plan is formally filed.