Thai finance authorities made an important announcement on Monday, April 28, 2025, concerning a new initiative offering tax incentives and a service for LTF holding transfers to strengthen sustainable investments in Thailand. 

In other words, The Ministry of Finance (MOF), the Securities and Exchange Commission (SEC), the Association of Investment Management (AIMC), and the Stock Exchange of Thailand (SET) have together decided to collaborate and take steps to enable investments in Thailand ESG Extra Funds (Thai ESGX)  and transfers of Long-term Equity Fund Units (LTFs) from May 2, 2025.

To that end, a new centralized service offering access to investors of their combined LTF holdings data, will be up on the SET portal, as a way to support their decision involving LTF investment switching under the government’s latest tax incentive program. According to predictions by the asset management industry, Thai ESGX is expected to draw investments THB 20 million or $596.48 million.

Read More: The Top 3 Visible Benefits of ESG Investing

After launching tax incentives intended to boost ESG stocks and consolidate the Thai capital market, the government decided to initiate the Thai ESGX scheme. The SEC has put together certain legal guidelines that look into the setting up and management of Thai ESGX. Interestingly, a total of 37 Thai ESGX gathered from 19 asset management companies are looking to obtain SEC’s approval.

The asset management industry will take the initiative to provide Thai ESGX from May 2, 2025, and the transfer of LTF investments will commence from May 13, 2025. 

Warotai Kosolpisitkul, the Fiscal Policy Office (FPO) International Economic Advisor, has issued a detailed statement on the tax incentive program. He has said, “Following a wave of LTF redemptions in early 2025, which affected the Thai capital market, this tax incentive program has been initiated with aims to stabilize the market, bolster fundraising through SET, and promote investments in ESG stocks. The two-prong incentive for new and existing investments is 1) Tax benefits for new investments in Thai ESGX, and 2) Tax benefits for LTF transfers to Thai ESGX. These measures will provide investors with additional investment alternatives, expand the number of sustainability-conscious investors, increase the proportion of institutional investors focusing on sustainability-related stocks, and ultimately incentivize listed companies to adapt their businesses towards long-term sustainability.”

Also Read: ESG Thematic Funds: A Comprehensive Guide for Sustainable Investing

According to the SEC Secretary-General, Pornanong Budsaratragoon, the SEC believes that Thai ESGX will make a meaningful contribution toward implementing ESG measures across varied industries and Thailand’s agenda concerning national sustainability. Thai ESGX will also push the public to make sustained investments in the capital market. 

Finally, AIMC Director Theeranat Rujimethapass has summed up the views of Thai asset management companies by sharing that asset managers take the responsibility of making sure that sustained investments offer their intended value to investors. Additionally, they support the stability of the Thai capital market and help listed companies enhance their ESG performance while they (companies) attempt to meet their net-zero goals, and support sustainability in Thailand. 

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Source: Thailand Business News