Includes customs regulations and contact information for this country's customs office.
duties are an important part of the Thai taxation system. Duties are collected on both imports and selected exports. The classification of goods for duty purposes is based upon the Harmonized Commodity Description and Coding System (commonly referred to as the “Harmonized System” or “HS Code”) and is, therefore, consistent with the classifications used by most of Thailand’s trading partners. Duties are levied on an ad valorem basis or at a specific rate, whichever is higher. On January 1. 2000, Thailand adopted the GATT Valuation Agreement. Imported articles are subject both to duties and to a value added tax (VAT), which is also administered by the Customs Department. Export duties are imposed on only a few items, including rawhide and wood. Exports are taxable at a zero percent VAT rate.
Customs Procedures Related to Taxes and Duties
Customs procedures for goods arriving in Thailand are similar to those in most other countries. An importer must file an entry form, plus other requisite documents (such as a bill of lading, invoice, and packing list) with the Customs Department through an electronic channel called the “Paperless System.” For certain goods such as medical devices, pharmaceuticals, food supplements, cosmetics, and chemicals, an import license is required, and duties and VAT are due upon arrival. When total duties have yet to be determined or urgent clearance is required, a deposit may be paid. Finally, landing and storage charges must be paid before the goods are released. Imported goods can also be stored in bonded warehouses. Generally, the obligation to pay duties arises at the time of import, whereas stored goods are assessed at the tariff rate in effect on the date of release.
To expedite customs clearance, an advance entry system allows importers to file the required forms, including the bill of lading, prior to the arrival of the goods in Thailand. The amount of duties can then be determined with reference to the bill of lading. Once the goods arrive, the duties and port charges need only be paid before the goods are released. It is often worthwhile to use the services of an experienced agent to assist with clearing goods through customs. Shipping agents often provide their own clearing agents. When goods accompany passengers arriving by air, sea, or land, a declaration is required. If necessary, customs officers, at their discretion, can assess the value of the imported goods and collect any shortfall duties.
In addition to import duties handled by the Customs Department, certain import items are also subject to excise taxes. These items include gasoline and products thereof, automobiles (fewer than ten seats), electrical appliances, beverages, perfumes and cosmetics, yachts and vessels for entertainment, lead crystal and other crystals, carpets and other floor covering materials, motorcycles, batteries, marble and granite, liquor, tobacco, and playing cards. Excise taxes are also imposed on local products in the same categories as well as on certain entertainment service providers such as horse racing grounds and golf facilities. The excise tax is calculated based on the retail price.
The Thai Customs Department (http://www.customs.go.th/index.php?lang=en&) has endeavored to impose and amend departmental notifications and regulations in compliance with the Customs Act, B.E. 2560 (2017) (the “Customs Act”). However, due to the COVID-19 pandemic and the Revenue Department’s enforcement of the transfer pricing regulation in 2020, the Customs Department is now carrying out stricter post-clearance audits and is more likely to challenge importers on complex issues – meaning customs valuation and utilization of customs and trade privileges – in addition to conventional issues like tariff classification, origin of goods, and import and export requirements. The transfer pricing regulation closely interacts with customs valuation, which is the procedure to determine the import value to calculate the duty to be paid on imported goods. Therefore, it is essential that the transaction value, which is the first and primary method to assess and determine the import duty, is the actual price paid or payable in a transaction between a seller and buyer. In a relationship between affiliated companies, the transaction value of goods may be below the normal market price. The concern over whether the value of imported goods in a transaction between affiliated companies is legally accurate has led the Customs Department to focus more on customs valuation in the post-clearance audit. Therefore, importers must meticulously check the transaction value declared to the Customs Department, as well as the transfer pricing measure, to avoid a challenge or dispute concerning customs valuation – the risk of which has increased significantly at this time.