Finance Ministry Moves to Introduce 7% VAT on Inexpensive Imported Items

[Bangkok Barry]

2 hours ago, Andre0720 said:

 

Quite right.

Thailand is working hard at making imported items 'expensive', and now even more expensive is a new objective.

 

A pack of Italian coffee, with all the added costs of the imported items in my country, costs about 100 bahts ($4. Can). And I can buy regularly Lavazza coffee on sale at home for 75 bahts ($3. Can.)

 

Thailand managed to tax this coffee brand until it reached 500 bahts.

And now more.

Oh well.... How about a cup of nice coffee from Chiang Mai...

 

 

 

I had an Argentinian steak in Spain for 15 Euros. In Thailand you'll pay 2000+ or 50 Euros for the same thing.

[sambum]

24 minutes ago, Dan O said:

Yep but you have to start somewhere and all the corruption has been decades in tge making and will not be stopped a just a few years. Things started to change in some areas during covid and sign of change are all around, much to tge dismay of the older expat community that's wants the freedom of the past without the cost but constantly complain about infrastructure or changes to lifestyle.   Can't have both unfortunately.

 

I think you misunderstood my reply - "I think you hit the nail on the haead" = "I agree with you!"

[Bangkok Barry]

2 hours ago, ExpatOilWorker said:

No, just let Lazada and Shopee add VAT the moment you click buy.

Ali Express will be a bit more tricky, but doable.

Shopping 🛍 outside these platforms will still be dealt with case by case.

 

Perhaps you didn't read to the end of the article. There is no plan yet in place to operate as you say.

Initially, the Customs Department will be responsible for collecting the 7% VAT and passing it on to the Revenue Department.

Future discussions will explore the possibility of involving online platform operators in the collection process.

[sambum]

4 hours ago, Expat Tom said:

Clever, Since I order my vitamins from the states I will  be forced to pay 3 times as much here because the mechanism for paying the VAT will be a nightmare and delivery times protracted.  . This is just one more item to put in my RFL  (Reason For Leaving)  file. Soon the Bangkok Brain Trust will completely kill the goose that lays the golden egg. 

There are estimated to be over 80,000 farang living in Thailand.  How many will leave before the Clown Show in BBK feels the pain. Let's harass the farang, tax them, charge them more to enter public parks and go to the hospital and make the visa process stupid. There are 9 other countries on the International Living list of best places for Expats to live abroad and two of them are other ASEAN countries; the PI and Vietnam. No place is perfect but the shin is wearing off Thailand for me.

 

"the SHIN is wearing off Thailand for me.

 

Pretty sure it was a typo, but nice result! 🙂 

[khunpin]

Good, first step trying to stop stop the market being oversupplied by all those foreign online shops. 

Nobody needs their cheap, brown, smelling schydd 💩. 

[Airwolf]

They also like to include the shipping fee in the tax and there's extra fees. 

I recently had an item delivered from Alibaba, the fees were 38%

I also had a ledger sent from France last year, the fees were over 100% (they taxed the shipping fee which was over 100 euro)

 

[Srikcir]

3 hours ago, Ben Zioner said:

We need another military coup.

Is Thailand really not operating now within a military coup leadership? 

[newbee2022]

2 hours ago, HappyExpat57 said:

EXACTLY!!! I have struggled for WEEKS to find the red filters for the GoPro Hero 12 underwater case, both online and personally traveling to all the places in Pattaya where folks ASSURED me they would carry them. They're not available in Thailand, full stop. I ordered them from Amazon US, they got here in about 2 weeks. NOW they want to place an additional tax on things you can't get in LOS? I believe that's called extortion.

Do you believe to become poor now?🙏

[FritsSikkink]

7 hours ago, ezzra said:

What a lame excuse, just go out and say 'We were racking our brains and thinking how to get more money from the public

and we think we found it'...

Nothing lame about it.

[digger70]

5 hours ago, JensenZ said:

Currently, there are no VAT or import duties on imported items under 1500 baht. When they introduce a 7% VAT, it will also be charged on shipping fees. It will be a big money grab.

Isn't it Always about the Money. (greed)

They will keep on looking to find ways to skin the people about their money being that the natives or foreigners.

[Sydebolle]

1 hour ago, Dan O said:

Your thinking is all off base because your throwing out what if scenarios rather than sticking with facts 

 

.... thank you, every day is school day. And what exactly is "factual" in this case? I must have missed something it seems. 

[PETERTHEEATER]

5 hours ago, hotchilli said:

China will not be happy. 

Could be worse. Notice how this report refers to 'inexpensive' instead of 'cheap'😀

[ignore it]

2 hours ago, sambum said:

 

"Feel safe as my orders always under 1500Bhat."?

 

Somehow think you are not reading the article correctly! Here is the headline for you to read again! :-

The Finance Ministry is set to present a proposal this week to revise the Revenue Code, imposing a 7% value added tax (VAT) on all imported goods valued under 1,500 baht.

 

Kudos to sumbum for noting.

 

Thus I've extended my research beyond my strife's opinion (always a dangerous action) and done some real research.

 

Yes, "consumers purchasing low valued goods from overseas suppliers <currently> do not need to pay 7% VAT (Current exemption)"  VAT rules exempt goods that are exempt from customs duty, as goods with value under THB 1500 are exempt from duty.

 

When I purchase from an online retailer (Lazyda) In Thailand, although I try to source from seemingly local suppliers (noted on the offering page), the item may be in fact shipped to me directly from china, or from the local supplier (read chinese with a Thai nominee) having been sent for my order shipped by the local supplier.   

 

Although most of the crap I buy from Lazyda comes from an overseas supplier (china) I am not the importer, as I am buying from Lazyda.

 

So is not Lazyda the consumer and liable for the imposition of the 7%VAT. If not Lazyda their "suppliers" are liable.

The chinese shell companies doing business in Thailand and importing small value items against my orders seem to be the ones evading the 7% VAT.

 

I still feel safe. The actual importer might have to factor the 7% into their pricing, or Lazyda may have to have a 7% add on to their order confirmation page.  

 

In any event I won't be trotting down to the post office to pay VAT on my box of pins or cheap flashlight. Not that their made in Thailand.

 

I expect that as the final  consumer it will be invisible and rolled into the price as it is when I buy a packet of condoms at the 7-11. Not that I need them.

 

As this is really about elephants, I won't be affected.

[gargamon]

6 hours ago, Bangkok Barry said:

 

You are thinking things through, not something Thais are known for.

Sorry, I can't help myself.

[JensenZ]

3 hours ago, digger70 said:

Isn't it Always about the Money. (greed)

They will keep on looking to find ways to skin the people about their money being that the natives or foreigners.

What I do see are long queues at the mail centres; of people picking up parcels that were previously delivered, to pay 100 baht or less.

[Yellowtail]

3 hours ago, digger70 said:

Isn't it Always about the Money. (greed)

They will keep on looking to find ways to skin the people about their money being that the natives or foreigners.

So, collecting taxes is greed? 

[sambum]

36 minutes ago, Yellowtail said:

So, collecting taxes is greed? 

 

Yes, in certain circumstances - like trying to collect taxes on monies that have already been taxed?

(Which may or may not be just hearsay!)

[Yellowtail]

1 minute ago, sambum said:

Yes, in certain circumstances - like trying to collect taxes on monies that have already been taxed?

(Which may or may not be just hearsay!)

What're you a right-winger? You make an argument that VAT should be eliminated altogether (which I would support, because it is hideously regressive), but in this case it's just the same 7% you'd have to pay if you bought the item domestically, and you are still avoiding the import duty. 

 

It's "social engineering". The gub-ment wants you to buy domestically produced products, which helps the county and disproportionally the poor. When you import otherwise taxable products, you not only avoid paying the tax, but you also negatively impact the importer.

 

[Autonuaq]

11 hours ago, gargamon said:

So all the AliExpress stuff I used to get delivered with no VAT will now be taxed. Almost seems like the administration costs will be higher than the amounts collected.

Tthey want to follow the example as done in other countries. they add the 7% all import as described and have extra administration fees to cover the costs. 

[JensenZ]

9 minutes ago, sambum said:

 

Yes, in certain circumstances - like trying to collect taxes on monies that have already been taxed?

(Which may or may not be just hearsay!)

In this case, imported items under 1500 baht have not been taxed.  

 

I frequently buy products from iHerb. It is duty and tax-free if it's below 1500 baht, but I often order much higher, from 2000 to 3000 baht and haven't had to pay tax. I've only been hit with duty and tax on 2 parcels in over 10 years. They let most slip through, but when they stop a parcel, you have to pay tax on the full amount (including shipping), not just the amount over the 1500 baht limit.

 

A 7% tax on a 1500 parcel is peanuts, but when I have to pay tax and duty I need to make a 16km round trip to the mail centre where they hold the parcel for payment. Can you imagine the back log of parcels awaiting tax payment at mail centres around the country?

[sambum]

1 hour ago, Yellowtail said:

What're you a right-winger? You make an argument that VAT should be eliminated altogether (which I would support, because it is hideously regressive), but in this case it's just the same 7% you'd have to pay if you bought the item domestically, and you are still avoiding the import duty. 

 

It's "social engineering". The gub-ment wants you to buy domestically produced products, which helps the county and disproportionally the poor. When you import otherwise taxable products, you not only avoid paying the tax, but you also negatively impact the importer.

 

 

Sorry, but you miss the point which I regrettably did not make clearer.

 

I was alluding to the Thai Government supposedly wanting me to pay tax on my pension that has already been taxed in the UK.

 

Apologies for any misunderstanding!

Edited May 13 by sambum

[sambum]

1 hour ago, JensenZ said:

In this case, imported items under 1500 baht have not been taxed.  

 

I frequently buy products from iHerb. It is duty and tax-free if it's below 1500 baht, but I often order much higher, from 2000 to 3000 baht and haven't had to pay tax. I've only been hit with duty and tax on 2 parcels in over 10 years. They let most slip through, but when they stop a parcel, you have to pay tax on the full amount (including shipping), not just the amount over the 1500 baht limit.

 

A 7% tax on a 1500 parcel is peanuts, but when I have to pay tax and duty I need to make a 16km round trip to the mail centre where they hold the parcel for payment. Can you imagine the back log of parcels awaiting tax payment at mail centres around the country?

 

See my previous post above this one!

Edited May 13 by sambum

[Robert Paulson]

Has there ever been a plan to eliminate a tax?

[Yellowtail]

1 hour ago, JensenZ said:

In this case, imported items under 1500 baht have not been taxed.  

 

I frequently buy products from iHerb. It is duty and tax-free if it's below 1500 baht, but I often order much higher, from 2000 to 3000 baht and haven't had to pay tax. I've only been hit with duty and tax on 2 parcels in over 10 years. They let most slip through, but when they stop a parcel, you have to pay tax on the full amount (including shipping), not just the amount over the 1500 baht limit.

 

A 7% tax on a 1500 parcel is peanuts, but when I have to pay tax and duty I need to make a 16km round trip to the mail centre where they hold the parcel for payment. Can you imagine the back log of parcels awaiting tax payment at mail centres around the country?

Correct. The actual cost generally is: Cost + Freight + Tax 1 + Tax 2 = Landed Cost

(Cost + Freight) X Duty  =  Tax 1

(Cost + Freight + Tax 1) X VAT = Tax 2

 

 

[Yellowtail]

17 minutes ago, sambum said:

 

Sorry, but you miss the point which I regrettably did not make clearer.

 

I was alluding to the Thai Government supposedly wanting me to pay tax on my pension that has already beEn taxed in the UK.

 

Apologies for any misunderstanding!

 

It's even worse in the US. In the US, when I earn money, it is taxed. If I save that money, it is taxed again. If I spend the money I have saved, it is taxed again.  

[Dogmatix]

13 hours ago, Expat Tom said:

Clever, Since I order my vitamins from the states I will  be forced to pay 3 times as much here because the mechanism for paying the VAT will be a nightmare and delivery times protracted.  . This is just one more item to put in my RFL  (Reason For Leaving)  file. Soon the Bangkok Brain Trust will completely kill the goose that lays the golden egg. 

There are estimated to be over 80,000 farang living in Thailand.  How many will leave before the Clown Show in BBK feels the pain. Let's harass the farang, tax them, charge them more to enter public parks and go to the hospital and make the visa process stupid. There are 9 other countries on the International Living list of best places for Expats to live abroad and two of them are other ASEAN countries; the PI and Vietnam. No place is perfect but the shin is wearing off Thailand for me.

 

Your vitamins might not get through at all, if they have to check every parcel, since they need a Thai FDA import licence and the only way to get this is to apply to the FDA as an importer and pay all the under the table fees.  Each product need a separate import licence.  So far they have turned a blind eye to small parcels of supplements.

[Dogmatix]

6 hours ago, ignore it said:

Kudos to sumbum for noting.

 

Thus I've extended my research beyond my strife's opinion (always a dangerous action) and done some real research.

 

Yes, "consumers purchasing low valued goods from overseas suppliers <currently> do not need to pay 7% VAT (Current exemption)"  VAT rules exempt goods that are exempt from customs duty, as goods with value under THB 1500 are exempt from duty.

 

When I purchase from an online retailer (Lazyda) In Thailand, although I try to source from seemingly local suppliers (noted on the offering page), the item may be in fact shipped to me directly from china, or from the local supplier (read chinese with a Thai nominee) having been sent for my order shipped by the local supplier.   

 

Although most of the crap I buy from Lazyda comes from an overseas supplier (china) I am not the importer, as I am buying from Lazyda.

 

So is not Lazyda the consumer and liable for the imposition of the 7%VAT. If not Lazyda their "suppliers" are liable.

The chinese shell companies doing business in Thailand and importing small value items against my orders seem to be the ones evading the 7% VAT.

 

I still feel safe. The actual importer might have to factor the 7% into their pricing, or Lazyda may have to have a 7% add on to their order confirmation page.  

 

In any event I won't be trotting down to the post office to pay VAT on my box of pins or cheap flashlight. Not that their made in Thailand.

 

I expect that as the final  consumer it will be invisible and rolled into the price as it is when I buy a packet of condoms at the 7-11. Not that I need them.

 

As this is really about elephants, I won't be affected.

 

That is the point.  They are not protecting any Thai businesses because nearly all the low end China products cannot be made in Thailand.  Thai middlemen cannot do much business importing them and selling them on at a mark up either because Thais will still buy them direct from China via Lazada, Aliexpress, Ebay and Shopee even if they have to pay VAT, as VAT only is cheaper than paying a mark-up plus VAT.

 

I, myself, no longer bother looking for small items imported from China in Homepro or Central.  They have poor selections and invariably don't have what I want.  If I want screws or nails or a little pouch or something I order direct from China, often low ticket items at less 100 baht with direct cheap shipping subsidized by China.  It is pretty obvious that the cost of collecting 7% VAT on these low cost items is going to be less than the cost collecting it.  

[Dogmatix]

When it  becomes effective, Thai consumers should run a campaign for everyone to order as many dirt cheap items from China as they can afford in one go to overload the system and make the government reconsider. 555

[Yellowtail]

6 minutes ago, Dogmatix said:

 

That is the point.  They are not protecting any Thai businesses because nearly all the low end China products cannot be made in Thailand.  Thai middlemen cannot do much business importing them and selling them on at a mark up either because Thais will still buy them direct from China via Lazada, Aliexpress, Ebay and Shopee even if they have to pay VAT, as VAT only is cheaper than paying a mark-up plus VAT.

 

I, myself, no longer bother looking for small items imported from China in Homepro or Central.  They have poor selections and invariably don't have what I want.  If I want screws or nails or a little pouch or something I order direct from China, often low ticket items at less 100 baht with direct cheap shipping subsidized by China.  It is pretty obvious that the cost of collecting 7% VAT on these low cost items is going to be less than the cost collecting it.  

Well, they'll be making 7% on everything you order now. 

[Arkady]

10 hours ago, Marco51 said:

What about books that are  internationally exempt? Do the customs bureaucrats know this? Or rather pretend they are waiting for the PM's orders, after all the poor man is everywhere and all the time and is expert on everything. The incredible admin costs may or may not be added too? Do they fill out a formsheet for every 100 Baht? Do we all have to plan in 1 hour daily  pick up of parcels at the post or maybe the airfreight department (farang please bring passports) ? Again the planning and implementation of new ideas is meticulous.

 

Yes, books are exempt from Thai VAT and import duty but there is an argument I have seen that only the books are exempt, not the cost of freight and insurance.