Below is the latest update on human resources regulations in Southeast Asia for 2025, released by Comrise. It covers the latest developments in labor laws, compensation, and other related regulations in major Southeast Asian countries, ensuring you stay informed about local market trends.
Follow the Comrise's official account for more information on overseas human resources laws and updates.
Thailand
1.Taxation
- Adjustments to Personal Income Tax Deductions (Effective January 2025): The tax threshold has been raised from 150,000 THB to 200,000 THB. Additionally, new tax deductions for remote workers have been introduced to encourage flexible employment.
- Optimization of VAT Policies: The proposal to increase VAT to 10% has been postponed. However, new VAT regulations for digital economy businesses have been added, requiring cross-border digital service providers (e.g., Netflix, Google) to register and pay 7% VAT in Thailand.
2. Labor Laws
- Protection of Remote Work Rights: New regulations require companies to provide equipment subsidies (minimum 500 THB/month) for remote workers and clarify overtime pay calculation standards.
- Tightening of Foreign Labor Quotas: The foreign labor quota in the manufacturing sector has been reduced by 10%, with companies required to prioritize hiring local employees.
3. Compensation
- Expansion of Regional Minimum Wage Differences: The minimum wage in economically developed areas like Bangkok has been increased to 450 THB/day (+6%), while other regions have seen an average increase to 400 THB/day (+4%).
4. Visas
- Digital Nomad Visa: Allows remote workers to stay for 1 year (renewable), with a monthly income threshold of 80,000 THB (approximately $2,200). Proof of employment contract or freelance income is required.
Indonesia
1. Taxation
- Adjustments to Corporate Income Tax Rates: For companies with annual income exceeding 50 billion IDR (approximately $330,000), the tax rate has been increased from 22% to 25% (effective April 2025).
- Mandatory E-Invoicing: All businesses must issue e-invoices through the government platform. Non-compliant companies face fines of up to 200 million IDR.
2. Labor Laws
- Adjustments to Severance Pay Caps: The maximum severance pay for non-fault dismissals has been reduced from 32 months' salary to 24 months to lower labor costs for businesses.
- Enhanced Protection for Female Employees: Companies with more than 50 employees are required to set up lactation rooms and provide flexible working hours for pregnant employees.
3. Compensation
- Minimum Wage Linked to Inflation: The minimum wage in Jakarta has been increased to 5.4 million IDR/month (+8%), while other provinces adjust based on local inflation rates (average +5%-7%).
4. Visas
- Simplified KITAS Work Visa Process: The approval time for foreign employee work visas has been reduced from 8 weeks to 4 weeks, but proof of local employee hiring ratio (at least 1:3) must be submitted.
Malaysia
1. Taxation
- Adjustments to Foreign Employee Taxation: The personal income tax rate for foreign employees has been increased from 28% to 30% (for income exceeding 600,000 MYR annually) to encourage the hiring of local talent.
- Tax Incentives for Green Industries: Companies in the new energy and carbon reduction sectors are offered a 5-year tax exemption or 50% income tax reduction.
2. Labor Laws
- Strengthening of the Occupational Safety and Health Act (OSHA): Companies are required to submit safety audit reports quarterly, with fines of up to 500,000 MYR for violations.
- Overtime Hour Limits: The monthly overtime limit has been reduced from 104 hours to 80 hours, with double pay required for any excess.
3. Compensation
- Unified Minimum Wage: The national minimum wage has been unified at 1,800 MYR/month (+6%), eliminating urban-rural differences.
4. Visas
- Premium Visa for High-Skilled Talent: Targets foreign nationals earning over 240,000 MYR annually (approximately $51,000), allowing long-term residence for 10 years with the freedom to change employers.
Singapore
1. Taxation
- Carbon Tax Increased to 50 SGD/Ton (Effective January 2025): Applies to companies with annual emissions exceeding 25,000 tons, significantly impacting manufacturing and shipping industries.
- Additional Tax for Foreign Employees: EP pass holders are required to pay an additional 1% "Foreign Talent Development Tax" to fund local employee training.
2. Labor Laws
- Legalization of Flexible Work Arrangements: Companies must offer remote work or flexible hours, with written justification required for any refusal.
- Adjustments to Severance Pay Standards: The minimum severance pay for layoffs has been increased from 0.5 months' salary to 1 month's salary (for employees with at least 2 years of service).
3. Compensation
- Industry-Specific Minimum Wages: The minimum wage in the service sector has been increased to 1,800 SGD/month (+5%), while the construction sector remains at 1,650 SGD/month.
4. Visas
- Increased EP Pass Threshold: The minimum monthly salary requirement has been raised from 5,000 SGD to 5,500 SGD, with 6,000 SGD required for the financial sector.
Philippines
1. Taxation
- Increased Tax Exemptions for SMEs: The income tax rate for businesses with annual income below 5 million PHP has been reduced from 20% to 15% (effective March 2025).
- Introduction of Digital Services Tax: A 12% VAT is now levied on cross-border digital services (e.g., streaming, online advertising).
2. Labor Laws
- Refinement of Anti-Workplace Harassment Laws: Companies are required to establish independent complaint committees to handle sexual harassment or discrimination cases, with fines of up to 1 million PHP for violations.
- Restrictions on Foreign Employee Positions: Foreign employees are prohibited from working in retail, food service, and other service sector roles (except for management positions).
3. Compensation
- Regional Minimum Wage Increases: The minimum wage in Metro Manila has been increased to 650 PHP/day (+7%), with other regions seeing an average increase of +5%.
4. Visas
- Digitization of 9G Work Visas: Application materials must be submitted online, with approval times reduced to 15 working days. However, a local employee training plan must be provided.
HR Recommendations for Businesses
- Timely Updates to Compliance Policies:
- Stay informed about tax filing and salary adjustment deadlines (e.g., Thailand's e-invoicing, Indonesia's minimum wage linked to inflation).
- Establish a visa expiration alert system for foreign employees to avoid illegal employment risks.
- Evaluate policies like Malaysia's "Green Tax Incentives" to adjust regional business strategies.
- Leverage Singapore's flexible work arrangements to reduce office costs.
- Comply with foreign labor quota restrictions in Indonesia and Thailand by prioritizing local hires.
- Participate in training programs supported by Singapore's "Foreign Talent Development Tax" to enhance team skills.
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