Page 209 - Social Enterprise A New Business Paradigm for Thailand

community or stakeholders before launching procurement processes. Additionally, the UK
government has implemented policies requiring social value assessments for high-value
contracts and has developed a Social Value Model to establish standards and improve

procurement efficiency.

In Thailand, Section 59 of the Social Enterprise Promotion Act, B.E. 2562 (2019), grants
social enterprises eligibility for benefits under government procurement and asset
management measures. This led to amendments to the relevant ministerial regulations in
2021, expanding the list of goods and services eligible for government promotion or support
to include those produced or provided by registered social enterprises. These were added
alongside existing categories such as products from village and subdistrict occupational
groups, cooperative stores, agricultural institutions, and organizations or foundations for
persons with disabilities. Despite these provisions, social enterprises in Thailand have yet to

meaningfully benefit from such measures. Relevant government agencies, particularly the
Office of Social Enterprise Promotion Office (OSEP), should play a more proactive role in
raising awareness among public agencies and local administrative organizations about
procurement promotion measures for social enterprise goods and services. They should
also act as facilitators to connect buyers and sellers, for example, by creating dedicated
online platforms to publicize products, services, and sales channels.

3. The Social Enterprise Promotion Act, B.E. 2562 (2019), provides that both social enterprises
and those who support them are eligible for tax benefits. One of the key incentives allows

individuals and legal entities to use investments made in social enterprises, or funds spent
on purchasing social enterprise shares, to reduce their personal or corporate income tax
liabilities. This measure is seen as particularly important by some social enterprises, such as
Thammadhajee Social Enterprise Co., Ltd., which raises capital by offering shares to the
general public.

However, under the current tax framework, shareholders are prohibited from transferring
or selling their shares until the social enterprise either ceases operations or, if it closes
within five years of registration, the tax benefits are retroactively revoked from the first

fiscal year in which they were applied. These restrictions significantly limit the effectiveness
of tax incentives in encouraging investment in social enterprises. To enhance the appeal of
these incentives, it is recommended that Thailand revise its tax policies to allow for greater
flexibility and stronger investor motivation. For example, the United Kingdom’s Social
Investment Tax Relief (SITR) program offers income tax and capital gains tax (CGT) relief to
individuals investing in social enterprises. Under SITR, investors can offset up to 30% of their
taxable income, provided they hold the investment for at least three years.

4. Since the mechanisms established under the Social Enterprise Promotion Act, B.E. 2562

(2019), still have limitations in driving the growth of social enterprises, it is recommended
that further study be undertaken to explore how to fully leverage existing funds under other

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