Thai customs to impose VAT on all postal imports
The Customs Department of Thailand next month is set to begin levying value-added tax (VAT) on all imported goods sent through postal services, regardless of the items’ value. This move comes in response to low-priced imports from China that have been flooding the market, providing an unfair edge as domestic producers are taxed.
Currently, imported goods sent via postal services are not subjected to import duties and VAT if the cost, insurance, and freight (CIF) value of each item is declared to be less than 1,500 baht. However, the Finance Ministry plans to enforce the collection of VAT on all imported goods, irrespective of their value, while still maintaining the exemption from import duties.
The finance permanent secretary, Lavaron Sangsnit, disclosed that the Customs Department will swiftly proclaim this new tax collection policy, which is a faster solution than revising the Revenue Code. However, he also mentioned that the threshold for exempted goods should not encompass prohibited items.
As the source from the Finance Ministry explains, each country determines its threshold in accordance with its economic conditions. For Thailand, the limit used to be 1,000 baht, but it was increased to 1,500 baht per item in 2018.
Statistics show that Thailand receives more than 30 million parcel imports yearly, with over half of these parcels claiming to be items with a CIF value not exceeding 1,500 baht. Online platforms that sell goods from China are importing a large quantity of low-priced goods in container loads, each containing tens of thousands of items.
This massive influx of low-priced goods presents a significant challenge for customs officials, as it would require a substantial amount of time to open each box for tax assessment, as proposed by the Finance Ministry. As a result, officials are now contemplating suitable methods for collecting tax on these low-priced goods, reported Bangkok Post.
