Page 204 - Social Enterprise A New Business Paradigm for Thailand

community products and distributing OTOP goods; advancing agriculture, product processing,
and community-based tourism; improving the quality of life for cancer patients and terminally ill

individuals; addressing environmental challenges; and providing scholarships and training for
underprivileged youth to become elderly caregivers.

The more than 300 organizations registered as social enterprises represent only a fraction of the
approximately 122,350 171 social business organizations operating across Thailand. Whether a
legal entity, such as a company, registered partnership, foundation, or association, chooses to
register as a social enterprise with OSEP depends on its readiness and on whether registration is
seen as offering meaningful advantages for the organization’s operations. Table 6.12 compares
the legal benefits already available to various types of public organizations with the additional

benefits they would receive upon registering as social enterprises.

Table 6.12 shows that the additional benefits organizations can gain from registering as social
enterprises include:

(1) The right to use the term “social enterprise” in the organization’s official name. However,
interviews reveal that some organizations are not interested in registering, partly due to unclear
understanding of the registration requirements and partly because they worry that using the term
“social enterprise” may lead the public to expect lower prices for their goods and services.
(2) Access to financial assistance from the Social Enterprise Promotion Fund. At present, however,
the Fund has no available capital and is not yet able to provide financial support to social

enterprises.
(3) For limited companies registered as non-profit-distributing social enterprises, eligibility for
corporate income tax exemption. Yet many social enterprises are small businesses with limited
revenues; some operate at a loss or earn just enough to sustain operations. Small non-profit-
distributing social enterprises often view the corporate income tax exemption as offering little
practical benefit and hope that OSEP will explore ways to better support small enterprises, rather
than applying the same measures to both large and small companies.

(4) Individuals or legal entities that invest in or purchase shares of registered social enterprises
are eligible for income tax exemptions on the amounts invested or paid for shares. However, this
incentive has notable limitations: shareholders are prohibited from transferring or selling their
shares. If shares are transferred before the social enterprise ceases operations, or if the enterprise
loses its registered status within five years of registration, investors will forfeit their tax benefits
retroactively from the first tax year and will be required to repay taxes for all periods in which
they previously claimed deductions.

171 Comprising 18,506 associations, 14,330 foundations, 6,316 cooperatives, 82,888 community enterprises, and 310
social enterprises, totaling 122,350 organizations.
171