I was messing about with this Thai bird on the internet the other day when she showed me a picture of her car.

It looked better than my GBP£400 Peugeot 306 but I was pretty surprised when she told me it cost her 140,000 baht. She was equally surprised when I converted what I paid for mine into baht (28,000)

How come most things in the Kingdom are much cheaper than here in the UK, whereas cars come in at a premium?

Maybe I've got the wrong end of the stick about this, but I'm curious about it.

In a word import duty

There are three reasons...

First - cars cost more in Thailand tax-wise. UK taxation on the purchase of cars is actually fairly low. - 17.5% VAT is pretty much it... - In Thailand 74% is the lowest rate of tax on a car built in Asean or Oz - over 200% for a car built in Europe or Japan. (Rates are for a car - there are lower tax rates on Asean built pickups and some 4WDs).

Second - running a car in Thailand is remarkably cheap. Servicing costs are a fraction of what they are in the UK, and petrol is effectively untaxed and diesel is SUBSIDISED... There is no MOT, and the legal minimum insurance is cheaper (as the cost of fixing the car if in an accident is also cheaper).

Third - Thailand doesn't allow the importation of used cars. (except for people immigrating (with a work visa), or Thais returning from abroad - with special rules on how long they owned the car while abroad, and a restriction of a single car. - and you still have the import duties to pay on the used price...)

i.e. Buying a car here is a major investment, but you can keep it running a lot longer for a lot less money than in the UK. As there is no import of used cars from abroad (i.e. UK / Ireland actually get a lot of imports of used cars from Japan), the availability of used cars is artificially kept low, resulting in a higher value being applied to the vehicle. On the other hand a 10 year old car here, will probably be in better condition (i.e. no rust), or at least, far cheaper to get into good condition, than the equivalent car in the UK. - so is actually worth more.

Thetyim

Don't want to be picky but thats two words .

Edited June 13, 200521 yr by roscoe

Thetyim

Don't want to be picky but thats two words .

You are absolutely correct.

My sincere apologies

In a word excise.

<{POST_SNAPBACK}>

Edited June 13, 200521 yr by roscoe

Mike,

Not sure about some of your statements there.

Is diesel still subsidised, I thought we were paying market rates now.

There is a MOT. Not sure at what age it kicks in, 7 years ?

Mike,

Not sure about some of your statements there.

Is diesel still subsidised, I thought we were paying market rates now.

There is a MOT.  Not sure at what age it kicks in,  7 years ?

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I owned a 1983 Mercedes 300 SD turbo diesel in mint condition in the states. Book value around $ 5,000.oo US. I really would have liked to take it with me. However, when I found out how much it would actually cost (between shipping, duty, taxes etc) I ###### near fainted, The least expensive quote was $ 17,900.oo US (724,950 Baht at todays exchange rate )

Aviador,

Sorry if I was not clear in my post.

I was not querying that a huge ammount of duty is levied, only questioning the diesel subsidy and MOT.

Aviador,

Sorry if I was not clear in my post.

I was not querying that a huge ammount of duty is levied, only questioning the diesel subsidy and MOT.

<{POST_SNAPBACK}>

Diesel is still subsidized at just about the same old rate - they did a paper shuffle and lowered the "tax" and reduced the subsidy. Same old price at pump.

Over time it is scheduled to be at market rate - but we all believe in the tooth fairy too. Right?

I heard that Thai students abroad can purchase a new car (European or otherwise), own it for 1 year minimum, and then import it back to Thailand in their name without having to pay the usual tax. Can anyone confirm if this is correct?

The information actually came from a Thai student in the UK, but I just can't see it being as simple as she made it sound.

That law definitely existed, but I'm not sure if it's still around.

Oddly enough - Thai rules that only apply to Thai nationals tend not to be displayed in English anywhere, and I've not got off my backside and learnt Thai yet.

There are usually restrictions on your ability to resell a personal import, so it might still be true.

(How many Thai students have enough money to study abroad, buy a car while abroad, then choose to return to Thailand to live. I'm guessing it would only be those whose parents are fairly well connected... - which means the tax break could easily still exist).

Edit: Yes - Diesel is still subsidised for the time being, although I will admit I'm rather surprised it didn't get floated a couple of weeks after the election...

Edited June 13, 200521 yr by bkk_mike

I heard that Thai students abroad can purchase a new car (European or otherwise), own it for 1 year minimum, and then import it back to Thailand in their name without having to pay the usual tax.  Can anyone confirm if this is correct?

The information actually came from a Thai student in the UK, but I just can't see it being as simple as she made it sound.

<{POST_SNAPBACK}>

Some time friends of mine were studying in the US and living in NJ just across from NYC. They had a low-end Mercedes(3 series or something like that) that was about a year / year and a half old. They were coming back to LoS (last November)and wanted to ship their Mercedes, and thought that they could do just as you suggested. So they did not try to sell it. When they went to the Thai shipping company to have it shipped, they found at that they would have to pay a 200% tax or so on it. They decided not to ship it. I ended up helping them to sell it at the last minute. Just in the nick of time, we sold it back to a dealer.