Greetings and welcome to the second instalment of the ASEAN Investment & Tax News of 2022.
On 14 September 2022, the ASEAN Investment Report 2022 titled “Pandemic Recovery and Investment Facilitation” was released at the 25th Meeting of ASEAN Economic Ministers - ASEAN Investment Area Council. According to the report, foreign direct investment (FDI) inflows in ASEAN increased by 42% to reach US$174 billion in 2021. This increase to near pre-pandemic levels reflects the attractiveness of the region’s economy for global investors. With a large market and strong regional integration, ASEAN remains a major FDI destination in the developing world – second only to China – and will play an important role in driving global economic recovery.
However, the ASEAN region is not spared from the economic effects from the Ukraine-Russia conflict which has increased food and energy prices and further complicated global supply chain disruptions. Although quarantine-free travel in ASEAN has resumed, the rising global inflation and U.S. rate hikes threaten the region’s economic recovery in 2022.
Our tax experts continue to analyse and bring you the latest in-depth updates in ASEAN.
In this publication, we feature an article from Noel Clehane, BDO Global Head of Regulatory & Public Policy, which touched why Indonesia’s G20 chairmanship could not have come at a more important time, what it means for businesses planning to expand into Southeast Asia in the next two years and the opportunities in Indonesia.
We also have a guest article from UOB on setting sail on the voyage to ASEAN. The combined trade volume between China and ASEAN exceeded US$800 billion for the first time last year. The Regional Comprehensive Economic Partnership (RCEP)—which went into effect at the beginning of the year—will also aid in the development of a more inclusive and open economic and trade relationship within the ASEAN region.
In Cambodia, we discuss the Notification No. 10979 on the “Required Documents to Support the Interest Charge on Related Party Loans”, issued by the General Department of Taxation on 25 May 2022.
Meanwhile, in Indonesia, our colleagues discuss the value-added tax treatment on crypto assets transactions.
In Malaysia, we discuss the Malaysia Digital Status, under Malaysia Digital, a strategic initiative by the Malaysian Government, that is built on a foundation that has been laid by Multimedia Super Corridor (MSC) Malaysia and aims to promote digital transformation and accelerate the nation’s growth into a knowledge-based economy.
In Myanmar, our colleagues discuss investment updates and guidance on withholding tax reporting obligations.
Finally, in Thailand, we discuss the international business center (IBC) regime with the corresponding tax and non-tax incentives, the new visa called the ‘Long-Term Resident visa (LTR)' and other tax updates.
Read more as we continue to delve into the latest Investment and Tax news in ASEAN.