A Taxing Issue is popping up in Phuket Town

Phuket’s infrastructure, medical facilities, and strong international flight connections place it in a strong position to compete as a destination for the “work holidays” market, said Luca Dotti, founder and managing director of Homa, a rental housing company.

Dotti has just launched Homa Phuket Town, a 505-unit rental housing property, in October. He envisions it as an affordable co-living concept that offers lease flexibility and builds a community around its residents. The residents he hopes to attract are digital nomads, business and leisure travellers, expats, and families.

A taxing issue

With more people embracing flexible work options during the pandemic, digital nomad advocates believe that a much larger wave is set to break as soon as travel restrictions ease.

Yet, not enough is being done fast enough in Thailand to capture the economic benefits of this wave because of regulations, insiders point out. The biggest barrier is ultimately red tape.

The Tourism Authority of Thailand (TAT) does not keep official records of the exact number of digital nomads entering the country. That’s because it’s difficult to define the category of this particular group of visitors beyond “leisure” or “business”. There’s also no dedicated visa category for digital nomads, said Siripakorn Cheawsamoot, deputy governor for marketing and communication at TAT.

Most digital nomads enter Thailand on short-term tourist visas, which technically bar them from working, although this is seldom enforced on the ground. Employment is prohibited for holders of the longer-stay STV, too. The concept of digital nomads is technically in a “legally grey” space in the country, said Jonathon Jones, legal specialist at Belaws, a Thailand-based law firm.

But there are still a couple of legal options for digital nomads to work in Thailand. One possibility is to get sponsorship from an employee contract management company. It can hire digital nomads as staff, and provide a work permit and visa. This comes at a monthly fee of approximately $450-$600, according to Jones.

Another increasingly popular option is the Smart Visa Type S.

The ‘S’ stands for startup entrepreneur. It’s a six-month visa that’s renewable up to two years, and it allows foreigners to work in Thailand without a work permit. However, holders of this visa have to: a) launch a startup; or b) take part in promotional activities for tech startups or startup camps in industries approved by government agencies.

Most recently, the Thai Cabinet also approved a long-term 10-year visa to attract foreign investors and experts to the country. However, to qualify, you need to have: a) earned at least US$80,000 over the past two years; and b) have assets worth at least US$1 million.

All these options aren’t exactly accessible to all because of the high cost barrier. They’re largely limited to high-income professionals in the tech sector, said Jones.

A special visa for digital nomads would be much welcomed to resolve the confusion over their legal work status in the country. “Thailand can be a difficult place for rules, even without Covid,” said Armitage. “Many digital nomads don’t know if they’re breaking the law. If the government can help clarify the rules, or even send out a positive message, that will be helpful.”