Importing Into Thailand

[JML]

Hello Everyone,

It looks like I may have found an opportunity to actually import things into Thailand at cheaper prices than can be found here. Well, that will depend on the duty rate ... I see it can be quite high at times . I have a special contact for some technical equipment, so there is no single uniform material ... i.e. items made out of rubber and leather, other equipment made out of nylon and metal, often stainles steel.

Unfortunately, I will not be importing things in terms of containers, more like shipments of 20 - 50 units. Now here is the other catch ... the products are coming from China, but the origin is from the United States.

I need to understand the duty charges to determine if it is worth importing these things. Or if it is better to just fly up to China and pick up these things myself. If anybody knows how to go about determining the duty rate, I would greatly appreciate it.

Thanks!

[12call]

http://www.customs.go.th/Customs-Eng/Sampl...?menuNme=Sample

[Richard Hall]

Keep in mind that it is not just a matter of what percentage will be applied but rather how the CIF value will be determined by the Customs Authorities. No need to mention that "under invoicing" is common practise to save on customs duties and taxes and the customs officers are also surely aware of that.

Therefore, if a price on the accompanying invoice appears to be suspiciously low it may not get accepted but it will rather be checked in the database whether this product or anything comparable has been already imported in the past. In the affirmative and if the price was significantly higher one can be pretty sure that duty and tax calculation will NOT be based on the invoice value but rather existing records will be employed. It may although happen that a market value will be assumed or estimated and taxing will be done on this base.

Anyway, to be absolutely on the safe side make sure you have a good customs clearance agent and have this person consult with Customs Authorities prior to carrying out the actual export process. This will avoid that unexpected and unpleasant surprises occur all of a sudden and your own cost calculation possibly goes totally out of frame.

Alternatively, when in doubt give it a trial by just importing one or a couple of those items and learn how smooth and at what cost this shipment passes through customs.

Remember sometimes a good deal or biz just looks too good to be true but in most cases people are not aware of or not taking the hidden additional cost into consideration that eventually bring their total cost to an unlucrative and unprofitable level.

Lots of luck that your plans are going to work out as per your expectations.

Cheers,

Richard

[JML]

Hi Guys,

Thanks a lot for the information. I do have a few questions based upon these responses. First, I have seen the website:

http://www.customs.go.th/Customs-Eng/Sampl...?menuNme=Sample

These are samples, with the import duty being 60%. I am having a hard time thinking that the import duty for all products coming into Thailand, no matter from where, is 60%. Is there a place I can find the duties for these specific products ... i.e. through classifications, etc.?

Richard, you mentioned one thing that makes me a little worried. This is an industry I am VERY familar with, and even though these products are made in the US (well, some are made there, some products have the materials made in the US, but assembly in Korea), I can source them cheapest from China. In fact, very cheap. So even without any under invoicing (a practice I am very familiar with), the pricing is still very low. Otherwise, I would not even contemplate importing anything into this country.

Is there a possibility that with the pricing so low, they will duty these products at a higher rate? I am not looking to bank my future on this or anything, so with the small quantities I am looking at, every price increase hurts my ability to sell these.

One thing, you have a very good idea to import a sample run (of 1), and see what that comes out to be. Thanks for that tip.

Best regards,

Scott

[Richard Hall]

Dear Scott,

please don't get worried too much right from the beginning or scared off by that 60% duty indication which is basically the highest tax rate that can apply. Usually to luxury items such as cars, wine etc.

More often the rates are 5% (some raw materials for use in manufacturing processes in Thailand) - 30%. In the past I have imported computer desks from Taiwan and paid 20% duty and fancy textile mobile phone covers from Korea (country of origin China) at 30%. Just this week I received some samples of polo shirts from Germany to be used as target products for manufacture here in Thailand. Customs rate 30%.

On top of all those rates indicated there are certainly always the 7% VAT.

Anyway, a very important criteria is whether the products imported can be actually also produced locally or are they just pure luxury items. This is usually when the highest rates get applied. However, if you import a high-tech machine (or spare parts to fix that machine) from a sophisticated country to use in a local factory for the production of goods (ideally for export) most likely the rate will be a mere 5% or you may even get exempted from any duty payments under certain circumstances.

At this stage ask yourself the question whether those products you plan to import are already available from local producers and the imports will just be a cheaper alternative or are they so advanced that they can not manufactured locally. Do they benefit Thailand and/or the Thai people in any way?

Anyway, when the goods come into Thailand the price indicated on the invoice must be in relation to the product to avoid that the idea of under-invoicing arises. Take an objective look at the item and say well, the price for this is let's say 50 Baht (taking also in consideration the low production cost in mainland China). Does everthing fit together or does a "no way" thought come up? Just the same situation when you see an attractive really eye catching item in a store and when you look at the price tag you shout out "wow, that's unbelievable cheap, there's gotta be a catch".

However, to be absolutely on the safe side just bring one or a very small number of units in as previously indicated and make sure that the shipment actually goes through customs (usually this happens if you employ private courier services and the recipient is a juristic person (=company)). If the stuff comes by mail and is intended for a private address it may happen that the parcels by-passes customs (in this case you have only the option to take the items to the customs authorities, show them to them and indicate that you intend to bring these particular items in from China at a purchasing price of xxx Baht and what customs rate would be employed).

If for any reason you are hesitant or can not personally get in touch with the customs guys yourself please feel free to contact me (or possibly good ol' shipping guru Axel) by PM to get that job done for you. Certainly as a legitimate business man I expect compensation for my time because I have to pay taxes and hungry mouths to feed. Now, I can only hope that I get not whacked by an administrator for abusing this thread for business purposes. Darn where did I put those pain killers?

Anyway, I guess you are smart enough to get this all done by yourself by employing the previous advice and hence do not have to count on those extraordinary expensive services offered by greedy and blood sucking individuals such as me.

Heaps of luck and don't get frustrated too quickly. The road to business success is usually quite a rocky one whether it is here on in any other country.

Cheers,

Richard

[JML]

Hi Richard,

Thanks a million for the information. Ideally, I was looking for someone to tell me just look at website www.xxx.com, and look under the classifications sections and ... wow! There is my percentage. Wishful thinking, I guess! I know for a fact that the items are not made in Thailand, and yet ... sigh, they could be considered luxury items. But I have samples here that I can show customs, so you have given me two avenues.

Anyway, I promise not to hit the "Report!" button and let them on to the fact that there may have been a transgression in the rules. You have been a great help, and in case I do get to the point of no return, I would never dream of helping anybody make money off a forum like this ... but we could get a drink to talk about it.

Thanks!

Scott

[Richard Hall]

Hi Richard,

Thanks a million for the information. Ideally, I was looking for someone to tell me just look at website www.xxx.com, and look under the classifications sections and ... wow! There is my percentage. Wishful thinking, I guess! I know for a fact that the items are not made in Thailand, and yet ... sigh, they could be considered luxury items. But I have samples here that I can show customs, so you have given me two avenues.

Anyway, I promise not to hit the "Report!" button and let them on to the fact that there may have been a transgression in the rules. You have been a great help, and in case I do get to the point of no return, I would never dream of helping anybody make money off a forum like this ... but we could get a drink to talk about it.

Thanks!

Scott

Hi Scott,

May pleasure. "May the force be with you" and hope there will never be the point of no return.

If the situation occurs well, I'll have a draft Singh with ice cubes in it (What kind of a corrupt bugger I have turned myself into just after those few years in Thailand or is it just the will to survive 'coz the engine needs about one to two bots of Singh a day to keep running in this tropical climate?).

Cheers,

Richard