cnx_vinyl/docs/boi.md

BOI Investment Promotion

The project will apply for promotion by the Thailand Board of Investment. Research snapshot from July 2026, based on the BOI Investment Promotion Guide 2025/2026 and advisory sources; BOI revises its measures roughly annually, so every scheme cited here must be reconfirmed at filing time. The exact activity sub-code needs confirmation by a BOI-registered consultant before the application.

The strategic picture

Vinyl pressing is, in BOI terms, basic plastic consumer-goods manufacturing (Category 6, chemicals/paper/plastics), which lands in incentive Group B: no corporate income tax holiday on the core pressing activity, but the full non-tax package and machinery duty exemption. The tax value is engineered on top through the upgrade measures, where this project happens to be strong:

• Solar: no longer promoted; the battery may be. The alternative-energy measure (Announcement 2/2568, April 2025, under the Smart and Sustainable Industry framework) granted a CIT exemption on the solar investment, capped at THB 12M/30M/40M per MW. Announcement 3/2568 (5 June 2025, in force 1 July 2025) ended promotion for installing solar power generation under that measure for applications from 1 July 2025; what remains is machinery modified to use other renewable energy, and battery storage (BESS) with its inverters, the eligible investment capped at THB 12M per MW (B Global Law, Smarter Energy Solution, checked October 2026). So owning the ~520 kWp factory-roof array earns no BOI benefit; its case is the bill (see sustainability). Whether the 271 kWh battery qualifies is for the BOI consultant. A PPA developer selling solar power (200 kW or more per distribution point) can still be promoted under activity 7.1.2 (8-year CIT exemption); that benefit is the developer's, and how much of it reaches the PPA price is a negotiation (CapSolar).
• Automation and metrology: the Smart and Sustainable Industry upgrade measure (Announcement 15/2565, refreshed July 2025) rewards automation, smart machinery, and energy efficiency, typically 3 years of CIT exemption capped around 50% of the qualifying upgrade investment. The automated presses, inline optical inspection, and stamper metrology are the natural fit.
• R&D merit: investing at least 1% of revenue in Thai R&D adds 1 to 3 CIT-exemption years and can lift the exemption cap. In-house mastering, galvanics process development, and recycled-PVC work could be framed as qualifying development.

So the application is pitched on automation and technology content (and the battery, if it qualifies), not on "we press plastic discs."

What Group B still delivers (the core value)

• Machinery import duty exemption: significant with the entire equipment list imported (Germany, Sweden, USA, Japan). Import VAT goes with it: machinery or raw material imported with the duty exemption is exempt from VAT at import as well (Revenue Department answer on the BOI OSOS FAQ, checked October 2026); otherwise a BOI company is treated like any other for VAT. What it is worth: the capex blocks in total investment are vendor prices without duty or VAT, so they already assume promotion. Without it, the ~2.3M USD of imported machinery in the launch plant (presses, galvanics line, Sibert, cutting room, metrology; block midpoints, as total investment states it) would carry import duty, roughly 5 % (Thailand's MFN averages 4.1 % on HS 8477 plastics machinery, 0 to 10 % across HS 84; estimate until the HS codes are set), ~0.11M USD, and 7 % import VAT, ~0.17M USD paid at the border and only recovered later as input tax, mostly as a refund claim because exports are zero-rated. The plant and business plan calculator shows both cases; its BOI switch also counts the water treatment (ZLD/DI) as imported, ~2.5M USD at the midpoint (figures re-based October 2026; the earlier ~2.75M was the superseded start fleet).
• 100% foreign ownership of the promoted manufacturing company, overriding Foreign Business Act restrictions for the promoted activity
• Land ownership for the promoted operation despite foreign shareholding, plus a small allowance for office/residential use; note the privilege is tied to the promotion, which matters for the buy-vs-lease decision
• Visas and work permits via the One Stop Service, without the usual four-Thai-employees-per-permit rule; relevant for foreign commissioning engineers and the technical consultant
• Raw material duty relief: exemption for export production (1 to 5 years, renewable) and up to 90% reduction for domestic-sale production

Requirements

• Minimum investment THB 1,000,000 excluding land and working capital (comfortably cleared by the first pressing line alone)
• Debt-to-equity ratio no higher than 3:1, maintained for the life of the privileges; plan the equity/loan mix for the machinery and solar capex accordingly
• Modern machinery and process expected; ISO/environmental compliance for larger projects
• BOI promotion does not replace the factory license (Ror.Ngor. 4), hazardous substance registration, or wastewater permitting; the galvanics effluent is the most likely regulatory friction point regardless of BOI status

Regional angle: Northern Thailand

Chiang Mai, Lamphun, and Lampang sit in the Northern Economic Corridor, which BOI promotes as a creative-economy base; a vinyl/music manufacturing story fits that narrative. Locating in the Northern Region Industrial Estate in Lamphun simplifies factory licensing and land questions and provides shared central effluent treatment, which helps the galvanics permitting. Legacy "Zone 3" incentive tables still found online are outdated; the current area-based add-ons for Lamphun/Lampang must be confirmed with BOI directly.

Process and timeline

1. File via the BOI e-Investment system, then present the project at an analyst meeting
2. Decision: about 40 working days for projects under THB 200M (60 to 90 working days for larger tiers); roughly 4 to 6 months end to end to the promotion certificate in practice
3. Incorporate the company (if not yet done) and accept the certificate
4. Import machinery within the duty-exemption window, commonly 30 months from certificate issuance (extendable); the Newbilt/Pheenix delivery schedule must fit inside it
5. Reach full operation by the certificate deadline (typically about 36 months), with progress reporting, annual reports, machinery lists, and the 3:1 debt-to-equity ratio maintained throughout

Sequencing consequence

BOI approval comes before company incorporation is finalized and before any machinery purchase orders: duty exemption does not apply retroactively to equipment already imported, and the certificate defines the import window. The BOI application is therefore a dependency at the top of the project timeline, ahead of equipment contracts.

Open items

• Confirm the exact activity sub-code and tier for vinyl/PVC consumer-goods pressing (Group B assumption is well supported but not code-verified)
• Confirm the live version of the smart-and-sustainable measures at filing time, and whether the battery qualifies under the BESS part of the alternative-energy measure (THB 12M per MW cap); solar itself is out since 1 July 2025 (Announcement 3/2568)
• Confirm current NEC/Lamphun area add-ons
• Engage a BOI-registered consultant to structure the application so the automation and R&D measures (and the battery) stack on the base promotion
• Check whether R&D contracted with Payap University and the joint student programmes (Payap partnership) count toward the R&D merit or a skills-development measure
• Keep any future label/content/retail arm in a separate entity: media and service activities carry different (and sometimes Thai-ownership) conditions, and mixing them muddies a clean manufacturing application