Thailand Customs to Apply VAT on All Postal Imports

[xtrnuno41]

Well they had similar system in EU tax free from little amount of ordering. It was I believe 21 euro. 

And they changed it on EU level, no more tax free.

Sites from China ( fi Alieexpress) now prices included with tax for EU.

You dont have to go and pick it up in a line somewhere and pay. 

It does all automatically? Tax instant per country per item send on country's custom account?

And then a check by barcodes if incoming parcel really did the tax.

So Thailand copied this thing, probably some EU delegation tipped them to do so.

Also the other things like visa, money abroad tax and so on are from (probably not only delegation) EU.  

 

[sandyf]

47 minutes ago, Hakuna Matata said:

 

You will receive a notice from the Customs in your mailbox. You will pay the tax online, you don't need to visit the customs office under normal circumstances. After you have paid the tax, Thailand Post will deliver the package to your home.

Why on earth would anyone have to pay the Customs.

It is a change in the VAT regulations, no change in import duty, and VAT is paid by the seller to the revenue department.

The problem with online shopping is that sometimes it is difficult to know who the seller actually is. My suspicion would be that the companies taking the orders would be seen as factoring the goods and liable for the VAT. They would then need to recover any VAT already paid by the suppliers, the suppliers will have recovered any VAT paid to the manufacturers.

The VAT actually avoids what you are suggesting. If they had decided to apply customs duty to all online shopping that had been imported, that would have been a can of worms.

[Highlandman]

1 hour ago, Hakuna Matata said:

 

They will keep the packages at the regional customs office warehouse at your location, not at the Post Office.

 

That would be crazy. They've been doing that for high value imports or anything that they believe needs to be inspected but it isn't practical to do this for every parcel imported. It will create a huge mess.

[Highlandman]

1 hour ago, richard_smith237 said:

 

Happend before - we purchased something for my son from Next Thailand with free delivery (value was about 1300 baht)...   but the shipment came from overseas....  Thai customs calculated delivery which nudged the total cost up over 1500 baht, and then they charged us something in the region of 700 baht Tax (which included their handling charge or something similar)... 

 

Seemed very dodgy to me... 

 

That's strange. Never happened to me before. In fact, parcels valued at up to around 1800 Baht are usually delivered without incident despite technically being above the 1500 duty free limit. 

 

I've noticed on iHerb, if you order supplements through them and select the Flash express option, there are prepaid duties payable. By selecting the postal delivery method, they claim your order will be subjected to duties on orders above 1500 Baht but in practice they have been more obliging. I've sent a good 100 packages over the past few years so am pretty well versed with all of this.

 

DHL, FedEx and any other courier is a no no though as they'll assess duties regardless of the value of the item (even if it's 100 Baht) unless it's a book or document, in which case they'll deliver directly. 

 

Any supplements that go through DHL take an incredible 3 weeks to clear customs, prior to which you need to fill out some paperwork and provide a copy of your ID/passport. None of this nonsense is required if using the postal system.

 

Never send anything but documents through a courier as you'll regret it. The postal system is much faster and more reliable.

[Wrwest]

4 hours ago, BritManToo said:

Can't imagine China allowing this to happen!

At first thought ... Thailand attempting to use the VAT angle to avoid dealing with tackling trade tariff agreements (that being far more difficult).

[wealthychef]

4 hours ago, jimgilly said:

So does that mean you will have to go to the post office for every package coming in from another country to pay this BS tax?   On top of this,  they are working overtime trying to find how they can extract more money from expats living here.  There are better places in this world to be and I for one will be moving on.  Get out while you can because things are just going to get worse in the future.

exactly.  I'm in the middle of trying to figure out how to get FedEx to deliver my vitamins I ordered from Amazon.  I have to submit a passport, give someone power of attorney, and fill in some forms.  Bureaucracy here can be maddening!  LOL

[Highlandman]

39 minutes ago, chilli42 said:

Very timely reporting … this change to the law has been in effect since January.  At first, all packages had to be picked up and duty/tax paid at customs or post office … depending on the shipment method.  I made 3-4 trips to get my packages released and I am done with all importing.  They were letting small packages (large envelopes) through until this month. Now even items with a $20 value are being assessed tax, duty and handling.  As an example I had to pay $10 for tax, duty and handling to DHL for a $20 item. UPS and DHL have taken a bit of the pain out of this by allowing you to pay for tax and duty online before delivery. I travel a good deal so now I just have packages delivered to an address in the USA that I then bring back with me.

 

I think you're mistaken.

 

Even 4 years ago you had to pay duties on a $10 item if imported through DHL or another courier unless the item was a document or book (and even if it was a book but with an assessed value above 1500 Baht it would have been subjected to import duties if the tax hadn't already been collected at the time of shipping). Supplements were taking 3 weeks to clear customs, which is why I vowed to never ship them with a courier again. Whereas postal deliveries are very efficient with no delays.

 

I've had postal deliveries from overseas delivered directly as recently as Sunday a week ago. No changes to the past. So far at least.

 

I have two packages in transit I thought would have been delivered by now. I probably should have ordered them a few days earlier.

 

The first one looks like it will pass through customs tomorrow or May 1 and be delivered the following day. Can't say whether I'll be stung for VAT payment or not. If it passes through customs tomorrow I'd say probably not, even if only delivered on May 1 but if it's even a day later it's a maybe.

 

The second one claims to be in country already but on the Thai postal website it says it hasn't arrived yet. I expect it to arrive as early as tomorrow (they won't enter the number into the system until its scanned by them at the postal customs office) and so I won't know until 9am tomorrow.

 

Got a friend going to the USA for a few days to bring back some items so I'll have him carry some things back for me so I should be good for some time without needing to order anything else for now. I'll be real curious to see how they assess duties on postal imports from now on, if they actually go ahead with it.

 

If duties are collected by the merchant, I'll be fine with it but if not it could end up being a pain. All remains to be seen.

[Highlandman]

39 minutes ago, chilli42 said:

So far, in my experience, they are opening all packages … even A4 size envelopes.

In my experience they don't open anything unless they believe something suspicious is going on.

 

A lightweight, low value item generally passes through without further inspection. 

 

The invoice is attached in a pouch outside the box, easy to see how much the item is valued at without opening the box.

[sandyf]

10 minutes ago, sandyf said:

Why on earth would anyone have to pay the Customs.

It is a change in the VAT regulations, no change in import duty, and VAT is paid by the seller to the revenue department.

The problem with online shopping is that sometimes it is difficult to know who the seller actually is. My suspicion would be that the companies taking the orders would be seen as factoring the goods and liable for the VAT. They would then need to recover any VAT already paid by the suppliers, the suppliers will have recovered any VAT paid to the manufacturers.

The VAT actually avoids what you are suggesting. If they had decided to apply customs duty to all online shopping that had been imported, that would have been a can of worms.

I apologise for the misinformation in the post, it would appear that VAT on imported goods and associated VAT Returns does in fact come under the Customs department rather than the revenue dept.

However they are 2 different taxes operating in different ways, import duty paid by the importer would be added to the selling price whereas VAT paid by the importer would be recovered from the next step in the chain.

VAT liability = Output tax - Input tax.

Although the article says "postal" these articles can never be taken literally and I would expect to see some change in how the likes of Lazada and Shopee operate.

[Peterphuket]

It will probably be done in a different way than sometimes ago with the lowering of the tax on wine.

After all, today we still pay the same high price.

[Liverpool Lou]

1 hour ago, Expat68 said:

1 hour ago, Liverpool Lou said:

Where did you get that "double taxed, double VAT" garbage from?

Pay tax in my own country and pay VAT in my own country 

So Thailand is not double-taxing you as your post suggested.

[keithkarmann]

4 hours ago, redwood1 said:

So on a package thats worth 100 baht....They will have to process the package how many times to make sure they get their 7 baht tax?

 

Then you must go down to the post office and stand in line to pay your 7 baht tax to get your package...lol

 

The postie can collect.

[itsari]

I am sure this knee jerk reaction to the success of buying online with Lazada and shoppee products from china will be counter productive as many items are not available in Thailand . The VAT addition is designed to help Thai manufacturers. I just see less choice available from china in the near future 

Many items I have bought from  China through online shopping are just not available here in Chiang Mai at what ever the price. 

[alien365]

I think it would help it they made Lazada and Shopee make it clearer that the products are coming from China. Only yesterday, I bought something for 47 baht on Lazada through a Chinese seller. I did not realise it was an international seller until it was too late. Now I have to wait longer for it and these new changes will mean a lot of work will be required to collect an extra 3.29 baht.

[Dogmatix]

3 hours ago, Jeffrey346 said:

Just received an item declared at $185. no VAT was charged

The Customs Dept order has not yet been posted in the Royal Gazette. 

[Dogmatix]

56 minutes ago, Highlandman said:

 

 

Even 4 years ago you had to pay duties on a $10 item if imported through DHL or another courier unless the item was a document or book (and even if it was a book but with an assessed value above 1500 Baht it would have been subjected to import duties if the tax hadn't already been collected at the time of shipping). Supplements were taking 3 weeks to clear customs, which is why I vowed to never ship them with a courier again. Whereas postal deliveries are very efficient with no delays.

 

 

  
The exemption from import duties and VAT has only ever applied to things coming by post.  Things coming by courier never had any exemption. 

[Negita43]

3 hours ago, Jeffrey346 said:

Just received an item declared at $185. no VAT was charged

on all imported postal goods next month

[Confuscious]

I don't know everything about VAT, but in my understanding VAT is a Tax on the ADDED VALUE.
As sending something by post or a similar carrier is not adding to the value of the item, there is no VAT to be paid.
If the VAT was paid in China, when sending the package to Thailand the VAT paid on China could be reclamed back.
Same like when you buy something in thailand and export this to another country, you can reclaim the VAT paid in Thailand back at the airport.
Or am I wrong?

If Thailand wants to apply an additional IMPORT tax on all postal packages, that's a complete different thing and I am not sure that other countries would be happy with that.

[Dogmatix]

The coup government tried to do this but shelved the bill.  It was revived by the Prayut government but they dropped the cancellation of this exemption, presumably because it was viewed as impractical and costly to implement relative to the amount of VAT, given the large volume of really low value items flowing in from China.  At least one can say that the Prayut government put things like this through the democratic parliamentary process with public consultation according to the constitution.  This latest Thaksin government rules by decrees put out by bureaucrats, like the foreign remittance tax.  Thaksin has always liked to rule by decree and just do things without any planning and preparation and let the system figure it out.  An example is his 30 baht healthcare introduced with no planning on the funding.  It made the government hospitals technically bankrupt, so they had to be bailed out by the government, while it was later determined under the Sarayudh government, after Thaksin got booted in the coup, that the cost of collecting the 30 baht was more than 30 baht. So it became free.  

 

I assume this will be totally chaotic with huge backlogs created to collect tiny amounts of tax per package.  Right now you have to go to a post office and stand in long queues to pay taxes on overseas packages over 1,500 and they open every single one over 1,500 too. Anything that looks a bit out of the ordinary and may need an unobtainable import licence, like herbal supplements, you have to pick up from the postal customs at Laksi in Bangkok.  I assume there are some provincial offices but probably only in provincial capitals.  Often they have no clue what needs an import licence and have to go off and ask someone. But technically all supplements need an import licence. So this could destroy iHerb's large Thai business which comprises many supplements unavailable in Thailand.  So the business may just be destroyed rather than going to Thai middlemen.  

 

The whole argument about introducing fairness for Thai middlemen that want to sell the same products marked up is obviously complete BS and I am sure they don't even believe that story themselves but don't want to tell the truth that they are trying to grab as much tax as possible and don't care if it costs more to collect it than the tax or that it will be inflationary. If Thais can buy the items direct from China with VAT added by no mark up from a Thai middleman, that is, of course, what they will do.  But what is actually happening is that Thai and Chinese middlemen operating in Thailand are taking orders from Thais without keeping any stock themselves.  When they get an order, they get the several huge  Chinese stockists to drop ship individual packages direct to the Thai customers.  Since import duties are still exempted under 1,500, this system will continue.  Thai middlemen don't want to keep stock and, if they imported in bulk, they would have to pay both import duty and VAT.  So still more expensive than shipping direct from China. 

 

Even though this has been talked about since the coup government bill planned to introduce it in 2016 or so, it is still and as unthought through as can be and is likely to cause chaos.  If they have to do it, far better to announce that planning is in progress to make it viable and set u a system of online payment, so that goods can still be delivered by postmen without causing chaos at post offices and backlogs.  They should also just accept the declarations of most of the low value packages without opening them up, as they do now.  Opening an addition 1 million + small packages a month is going to require additional staffing and space and is not worth the cost. 

[Dogmatix]

15 minutes ago, Confuscious said:

I don't know everything about VAT, but in my understanding VAT is a Tax on the ADDED VALUE.
As sending something by post or a similar carrier is not adding to the value of the item, there is no VAT to be paid.
If the VAT was paid in China, when sending the package to Thailand the VAT paid on China could be reclamed back.
Same like when you buy something in thailand and export this to another country, you can reclaim the VAT paid in Thailand back at the airport.
Or am I wrong?

If Thailand wants to apply an additional IMPORT tax on all postal packages, that's a complete different thing and I am not sure that other countries would be happy with that.

 

Packages not exempted by the current regulation are taxed on the landed cost value.  That means import duty applied to the landed cost which includes insurance and freight.  Then VAT is applied to that.  Some items like wine also have excise duty and municipal tax applied before the VAT.  But VAT has always applied to imports of goods in Thailand ever since it was introduced.  If you import products that are manufacturing inputs or you re-export the whole thing. as you say, you can claim the Thai VAT charged at import back.  But you cannot claim back any foreign taxes and I doubt China charges VAT on exports anyway.

[borderhopper2005]

Another scum from the populist premier.

Instead of imposing proper tax on the 0.1% of the super rich in the country, increasing financial burden on expats and ordinary middle-class Thais.

I recently started to feel that the previous dictator was even better than him.

Democracy does not really mean change for the better here.

It often means more non-sense and corruptions.

[Dogmatix]

3 minutes ago, borderhopper2005 said:

Another scum from the populist premier.

Instead of imposing proper tax on the 0.1% of the super rich in the country, increasing financial burden on expats and ordinary Thais.

 

And will cause inflation and chaos with no benefit to anyone.

[Dogmatix]

Amazon and Ebay and some couriers have been operating a system whereby Thai taxes are collected in advance which means that items can be delivered to your door.  The taxes are described as deposits and you could be charged more or get a refund.  On the rare occasions I have used this service, I have been charged more than the actual Thai import duty and VAT but not got refunds.  Others have told me they have received refunds from the Amazon service though.  Both Amazon and Ebay have never distinguished items valued at less than 1,500 baht and charged Thai tax on them anyway which was not refunded.  I guess the way to go for Aliexpress and for items drop shipped from Lazarda and Shopee from China to Thailand will be to do something similar but only charge VAT below 1,500 which is easier because the rate is a universal 7%, whereas import duty varies from 5% to 40%. There should also be a system to pay VAT online for packages sent by individual senders or those too small to get into this type of sender.  

 

But introducing it through a bureaucratic order, bypassing parliament without any of this in place and without worrying about the volume of packages on which the cost to collect it will be more than the VAT is undemocratic, shameful and stupid - all hallmarks of this latest Thaksin government. 

[sambum]

4 hours ago, Jeffrey346 said:

Just received an item declared at $185. no VAT was charged

 

Erm? They haven't implemented it yet! :-

 

"Thailand's Customs Department will start charging Value-Added Tax (VAT) on all imported postal goods next month."

[Roo Island]

Most countries charge a VAT tax on imports.

[Gknrd]

When I was living there I learned the hard way not to buy anything to be sent into Thailand. Not sure how it could get any worse for foreigners.

[CecilM]

Not surprised. I just paid 2k tax on four shirts that my family sent via FedEx. (Why they didn't declare it properly and why they sent them via FexEd is a different story.)

[The Theory]

7 hours ago, John Drake said:

Prayuth was better.

People will realize that soon or later (when Taksin takes over).wait a minute, they are already in power😮🤨

 

 

 

[tandor]

so, who pays the tax...the Shipper or Recipient?

[ericthai]

5 hours ago, chilli42 said:

Very timely reporting … this change to the law has been in effect since January.  At first, all packages had to be picked up and duty/tax paid at customs or post office … depending on the shipment method.  I made 3-4 trips to get my packages released and I am done with all importing.  They were letting small packages (large envelopes) through until this month. Now even items with a $20 value are being assessed tax, duty and handling.  As an example I had to pay $10 for tax, duty and handling to DHL for a $20 item. UPS and DHL have taken a bit of the pain out of this by allowing you to pay for tax and duty online before delivery. I travel a good deal so now I just have packages delivered to an address in the USA that I then bring back with me.

It hasn't started yet. You were using DHL and UPS and they have been charging import/storage/clearing fee for decades.