IEAT Incentives

IEAT Investment Incentives

The IEAT, established in 1979 as a State Enterprise under the Ministry of Industry, is charged with carrying out the government’s industrial development policy. The IEAT is the principal regulatory authority for industrial estate construction and operation. The Authority is also the sole investor in three industrial estates, including Map Ta Phut and Laem Chabang Industrial Estates on the Eastern Seaboard, and more than 20 more joint operations with the private sector.

There are 17 export processing zones (free trade zones), where machinery, goods and materials may be imported free of duty and tax to facilitate production for export. Finished products produced in export processing zones are treated like imports when they are distributed in Thailand. Import duties are paid at the gate of the Zone.

Additionally, the IEAT may grant non-tax investment incentives (essentially the same as BOI’s non-tax incentives) to companies that locate in industrial estates. Most industrial estates also offer “one-stop shop” services to foreign investors in the estates.

Duty drawback scheme

Under the duty drawback scheme, exporters may recover import duties paid for importing raw materials that are processed into finished goods for export. Processing takes approximately three months. The duty drawback scheme is a workable alternative to import duty exemptions on raw materials provided by the BOI. Applications for duty drawback should be submitted to the Customs Department.

Bonded warehouses

Under the bonded warehouse program, manufacturers which import and export may import goods under bond into bonded warehouses without payment of import duties. No import duties need be paid on the goods unless they are distributed into the local economy. The program works in two ways. Importers and manufacturers may use the services of private companies operating commercial bonded warehouses, and manufacturers may request the Customs Department to designate their factories as bonded warehouses. In both cases, the Customs Department stations one or more officials at the bonded warehouse to facilitate import and export paperwork. Manufacturers must have a paid-in registered capital of at least 10 million baht of goods per year to qualify for bonded warehouse status.