Yacht customs duty dropped to zero

PHUKET TOWN: Phuket’s marine leisure industry broke out the Champagne today as the government finally dropped the customs duty on imported boats to zero, following publication of the change to the tax law in the Royal Gazette yesterday. Theera Paesathitthavorn, Deputy Chief of the Phuket Customs Office Region 5, told the Phuket Gazette today that he anticipates an increase in the number of yacht arrivals in Phuket as a result. Until the announcement, boats could be brought into Thai waters and stay for up to 12 months without the owner paying any taxes. But any boat kept here longer than a year was liable for duty and taxes totaling 47% of its value. This in itself was an improvement on the tax levels introduced in 1996, which took total imposts to around 230% of the value of the boat. Under the new regime, boats may still be kept in Thai waters for up to six months without having to be imported. Yachts that are imported will still incur excise tax, Interior Ministry tax and VAT totaling about 13% of the value of the boat. A source at the Phuket Provincial Excise Office said that the office was still waiting for a Ministry announcement on the reduction of yacht excise tax, currently 5%, to zero. A spokesperson for the Excise Department in Bangkok told the Gazette that the department needed more time to consider the law. The dropping of customs duty on yachts came after lengthy lobbying by the Marine Alliance of Thailand (MAT). The MAT argued that the country would benefit more from the income attracted by a thriving yachting industry than it would from trying to tax yachts heavily. Jan Jacobs, Director of yacht chartering, management and brokerage company Thai Marine Leisure, and a member of the MAT, said, “We’re delighted. It was sometimes difficult to believe it was going to happen. We hope this will boost the marine industry in Phuket big time. “It will help us to increase the charter fleet immediately and bring more wealthy tourists to Phuket.” Among the first to bring in boats and register them under the Thai flag will be yacht charter company Sunsail, which is expected to import 10 yachts by the end of the week to replace its aging fleet of rental boats. Ironically, the introduction of the zero duty comes just a day after the Chalong Tambon Administration Organization [CTAO] admitted that it was once more imposing its embarassing and much-reviled “Phuket waters fee” on all yachts visiting Phuket. No other province in Thailand levies a “waters fee” against tourists, and the CTAO impost is widely seen as detrimental to the central government’s efforts to promote high-end tourism and the growth of the boating industry in Phuket.