Smuggled Luxury Cars: ' Pay Tax To Avoid Legal Woes', D S I Chief Tarit

[webfact]

'Pay tax to avoid legal woes'
Piyanut Tumnukasetchai,
Kittiyanee Sommai
The Nation

BANGKOK: -- Unsuspecting buyers of smuggled luxury cars can get out of legal problems by covering the taxes, Department of Special Investigation (DSI) chief Tarit Pengdith advised.

However, he said, importers and distributors will most certainly face criminal proceedings because their crime cannot be settled out of court.

An informed source at the DSI disclosed that some 40 companies had brought super cars into Thailand illegally, but most of these were paper companies.

"As soon as problems arise, these paper companies get abandoned. There are some 30 firms in this group," the source said.

Most of these smuggled cars are sent in via Bangkok and Laem Chabang ports, the source said, adding that the smugglers usually exercised their connections with powerful politicians or their relatives to get the vehicles through customs.

"Some of these politicians are based in Nakhon Pathom, Pak Nam, Kamphaeng Phet and Thon Buri," the source said, adding that these politicians reportedly sought between Bt500,000 and Bt1 million per vehicle for the favour.

Tarit said he suspected that such illegal activities caused the country massive financial damage in lost revenue.

"Luxury cars are subject to a 200-per-cent tax, but if the importers can successfully declare them as reassembled vehicles, then the tax is just 30 per cent," he said.

He added that there were up to 5,832 vehicles registered as reassembled cars in Thailand.

The Cabinet, in fact, passed a resolution to ban the registration of vehicles reassembled from auto parts in Thailand since mid-2012.

However, this registration continues because the Land Transport Department has yet to issue a regulation implementing the ban.

Speaking on condition of anonymity, a DSI official handling cases in the South said some luxury cars were also smuggled in from Malaysia.

"Sometimes, the vehicles are put in empty containers returning to Thailand from Malaysia. Sometimes, Malaysians drive the luxury cars to Thailand openly and declare them as missing vehicles at home. These cars can be used in Thailand under documents issued for old or badly damaged vehicles," this official said.

He said users of such luxury cars in the three southernmost provinces were senior government officials. "That's why no one wants to dig deep," he said.

Smuggled cars

The case of smuggled luxury cars returned to the media spotlight after nobody stepped forward to claim ownership of super cars that were destroyed in a fire last week. Hence suspicions began to emerge and the DSI stepped in to take a closer look, when it learned that one of the Lamborghinis in the lot was on its watch-list of smuggled vehicles.

Meanwhile, National Anti-Corruption Commission member Pakdee Photisiri said yesterday he was waiting for NACC head Panthep Klanarongran to approve the setting up of a subcommittee to look into the smuggled vehicles. "I proposed its establishment after the Office of the Public Sector Anti Corruption Commission forwarded evidence involving some tax-evading vehicles to the NACC," he said.

Industry permanent secretary Witoon Simachokedee instructed the Thai Industrial Standards Institute to check whether any importer had avoided its inspections. "Even reassembled vehicles must be inspected," TISI deputy secretary-general Wirat Archa-apisit said.

He said any operator who failed to submit the vehicles for inspection would face a maximum fine of Bt1 million and/or a jail term of up to two years.

-- The Nation 2013-06-05

[tominbkk]

Easy solution, confiscate smuggled cars and auction off to charity.

[Thai at Heart]

Is the buyer of the car responsible for making sure the importer paid the tax?

What next? Cars to come wrapped in a paid excise tear strip. The buyers are supposed to call customs to check whether the importing company has smuggled it? Huh?

Edited June 5, 2013 by Thai at Heart

[richard_smith237]

The concern for some who have legally purchased 'luxury' vehicles might now be that they get targeted and their motors get fully inspected.....

[tomyummer]

Luxury super cars have a 338% tax, not 200%.

Yes, try digging deeper into this matter. The only thing you would be digging is your own grave.

It's so easy to trace the origins of the car and track how they got into the country with the VIN/chassis numbers, even in the case of fire. It's just that the DSI doesn't want to because of the 'person' link to them.

[Sydebolle]

Maybe it has to do with the fact, that nobody in his right mind would tax 200% plus excise and VAT - latter triggering off all the smuggling. Even 30% is quite a ticket but payable.
But then again, those in charge of defining such duties are those who benefit (in-)directly from breaching the law and avoiding them. The stupid one out is the fellow in pick-ups and small, most likely financed, vehicles.
Pathetic subject!

[Woodsie888]

The concern for some who have legally purchased 'luxury' vehicles might now be that they get targeted and their motors get fully inspected.....

It just depends on which 'political camp' the importing dealer is affiliated with and how much assistance he can muster. Every Importer uses a paper company to import. Importing cars under the 'parts scheme' or doing 'NGV' is only the tip of the iceberg. I can tell you, there are some very worried people at the moment and lots of cancelled orders out of the UK. If they start checking Commercial Invoice values, something quite smelly will hit the fan. Of course TIT...........

[rotary]

Easy solution, confiscate smuggled cars and auction off to charity.

How do I register to be a charity? Maybe they could let me use one of the Lambos to visit the villages in.

[8OA8]

When the Baht 5.5 million car in the official (registered brand) dealer showroom is being sold elsewhere at Baht 3 million, you gotta be asking yourself why would it be that cheap..

[Payboy]

"Sometimes, the vehicles are put in empty containers returning to Thailand from Malaysia. Sometimes, Malaysians drive the luxury cars to Thailand openly and declare them as missing vehicles at home. These cars can be used in Thailand under documents issued for old or badly damaged vehicles," this official said.

Whatever happened to the ASEAN free-trade agreement?

[pb1936]

The amount of tax charged on imported goods is a complete disgrace. It's not as though it is to protect home industries because there are no manufacturers here capable of making the products.

I have recently learned that a foreign company investing in a manufacturing base here has the same tax levied on home sales as would apply if the product were imported.

Maybe when the Asean Community is fully operative the Thai Government will be forced to change some of their habits.

[comserve]

The rules for importing of a private vehicle are quite ridiculous. When I came to Thailand I owned a very nice, but old, BMWK110LT motor cycle which had taken me right around Europe a coule of times.

It's present market value was about $3,000 (14 years old) but on enquiring I would have had to pay close to $10,000 to legally import it for personal use. I bought it in the UK & subsequently shipped it back to Australia. At that time it was valued at $5,500 by the local BMW dealer - had to pay 10% of that price $550 as GST to land it in AUS.

Needless to say, it did not come to Thailand, but got sold via Ebay in AUS.

What is the point of Thailand taxes on such imports??

[pb1936]

The rules for importing of a private vehicle are quite ridiculous. When I came to Thailand I owned a very nice, but old, BMWK110LT motor cycle which had taken me right around Europe a coule of times.

It's present market value was about $3,000 (14 years old) but on enquiring I would have had to pay close to $10,000 to legally import it for personal use. I bought it in the UK & subsequently shipped it back to Australia. At that time it was valued at $5,500 by the local BMW dealer - had to pay 10% of that price $550 as GST to land it in AUS.

Needless to say, it did not come to Thailand, but got sold via Ebay in AUS.

What is the point of Thailand taxes on such imports??

It's called Protectionism, Arrogance, and a desire to deny access by the average Thai to what is seen as high status items.

[jonclark]

The rules for importing of a private vehicle are quite ridiculous. When I came to Thailand I owned a very nice, but old, BMWK110LT motor cycle which had taken me right around Europe a coule of times.

It's present market value was about $3,000 (14 years old) but on enquiring I would have had to pay close to $10,000 to legally import it for personal use. I bought it in the UK & subsequently shipped it back to Australia. At that time it was valued at $5,500 by the local BMW dealer - had to pay 10% of that price $550 as GST to land it in AUS.

Needless to say, it did not come to Thailand, but got sold via Ebay in AUS.

What is the point of Thailand taxes on such imports??

Protectionism - Most imports - being imports are bought outside of Thailand, so the Thai economy (read government) doesn't get its share, only the foreign company which made the car. As a result, ordinary Thais have to but locally produced cars which keeps the Thai car assemblers working.

If the import tax was reduced a far higher percent of Thais would go for BMW etc, which would be bad for business.

[Woodsie888]

When the Baht 5.5 million car in the official (registered brand) dealer showroom is being sold elsewhere at Baht 3 million, you gotta be asking yourself why would it be that cheap..

I'm not sure what car you have seen for sale reflects that differential. Do you mind giving an example?

The Grey Market Dealers have actually had a very hard time competing with the Authorised Dealers price structure for the last year, due to many increases in various charges, the latest being the 44,000 TIS charge which is supposed to be levied on every car.

[Thai at Heart]

The rules for importing of a private vehicle are quite ridiculous. When I came to Thailand I owned a very nice, but old, BMWK110LT motor cycle which had taken me right around Europe a coule of times.

It's present market value was about $3,000 (14 years old) but on enquiring I would have had to pay close to $10,000 to legally import it for personal use. I bought it in the UK & subsequently shipped it back to Australia. At that time it was valued at $5,500 by the local BMW dealer - had to pay 10% of that price $550 as GST to land it in AUS.

Needless to say, it did not come to Thailand, but got sold via Ebay in AUS.

What is the point of Thailand taxes on such imports??

Protectionism - Most imports - being imports are bought outside of Thailand, so the Thai economy (read government) doesn't get its share, only the foreign company which made the car. As a result, ordinary Thais have to but locally produced cars which keeps the Thai car assemblers working.

If the import tax was reduced a far higher percent of Thais would go for BMW etc, which would be bad for business.

BMW and Mercedes have plants in Thailand don't they either for parts and whole cars. The margins generated on cars produced and sold in Thailand are very nice indeed.

[Thai at Heart]

When the Baht 5.5 million car in the official (registered brand) dealer showroom is being sold elsewhere at Baht 3 million, you gotta be asking yourself why would it be that cheap..

I'm not sure what car you have seen for sale reflects that differential. Do you mind giving an example?

The Grey Market Dealers have actually had a very hard time competing with the Authorised Dealers price structure for the last year, due to many increases in various charges, the latest being the 44,000 TIS charge which is supposed to be levied on every car.

Indeed, the margins for the grey marketeers have been getting tighter, but everyone makes a very nice margin either official or grey importer.

[bangkokstick]

Someone still wants to buy a car from importer to get it faster ? :-)

[Woodsie888]

Someone still wants to buy a car from importer to get it faster ? :-)

Yes, because they have ready stock.

[Kananga]

Any pink Bentleys on their miss list?

[billd766]

If nobody claims that black Bentley I will offer a couple of thousand baht and give it a new home.

Plenty of room in the chicken and duck compound.

[Thai at Heart]

Anyone seriously believe that these importers dismantle a Ferrari and put it back together?

i know they have some good car engineers in Thailand, but really?

[thaicbr]

Anyone seriously believe that these importers dismantle a Ferrari and put it back together?  

 

i know they have some good car engineers in Thailand, but really?

It's just nuts and bolts .... you do not need a gamma ray inverter do you?

Sent from my GT-P1010 using Thaivisa Connect Thailand mobile app

[Thai at Heart]

Anyone seriously believe that these importers dismantle a Ferrari and put it back together?

i know they have some good car engineers in Thailand, but really?

It's just nuts and bolts .... you do not need a gamma ray inverter do you?

Sent from my GT-P1010 using Thaivisa Connect Thailand mobile app

Well you say that, but reassembling a ferrari from bits, isn't exactly the same as putting a go kart back together. it's a fairly highly engineered piece of equipment. I wouldn't know, just wondering if anyone had ever actually come across a ferrari or lambourghini in bits in the workshop behind a showroom, with Somchai and his spanner putting it all back together.

Its not as though Ferrari employ too many Thai engineers on the line in Italy with first hand experience of putting this stuff together the first time. Beyond that, shipping it in bits would increase the chances of something getting lost massively. Oooops, no brake pedal.

Edited June 5, 2013 by Thai at Heart

[thaicbr]

Anyone seriously believe that these importers dismantle a Ferrari and put it back together?  

 

i know they have some good car engineers in Thailand, but really?

It's just nuts and bolts .... you do not need a gamma ray inverter do you?

Sent from my GT-P1010 using Thaivisa Connect Thailand mobile app

 

 

Well you say that, but reassembling a ferrari from bits, isn't exactly the same as putting a go kart back together.  it's a fairly highly engineered piece of equipment.  I wouldn't know, just wondering if anyone had ever actually come across a ferrari or lambourghini in bits in the workshop behind a showroom, with Somchai and his spanner putting it all back together.  

 

Its not as though Ferrari employ too many Thai engineers on the line in Italy with first hand experience of putting this stuff together the first time.  Beyond that, shipping it in bits would increase the chances of something getting lost massively.  Oooops, no brake pedal.  

I believe when they say shipping in bits they simply mean the body/chassis in one container and the engine in another. Then important bits like ECU etc come separately in boxes or even carry on luggage .

But I may be wrong.

Sent from my GT-P1010 using Thaivisa Connect Thailand mobile app

[monkeycountry]

Is the buyer of the car responsible for making sure the importer paid the tax?

What next? Cars to come wrapped in a paid excise tear strip. The buyers are supposed to call customs to check whether the importing company has smuggled it? Huh?

If you can afford a Lamborghini you also know the approximate price for a Lamborghini. Let's say it is appx. 20 million baht. If you as a buyer has paid somewhere remotely close to that amount, then you can reasonably argue that you thought everything was in order. I am sure there is a contract and a paper trail verifying the purchase price. However, if you as a buyer has only paid say 5 million baht, then you cannot reasonably argue that you did not know something illegal was going on, and you should therefore be prosecuted as an accomplice.

The same goes, at least in civilised countries, if someone offers you a brand new Iphone5 for say 50$ and you take the offer.

Basically I think you have to prove that you acted in good faith.

Edited June 5, 2013 by monkeycountry

[Thai at Heart]

Is the buyer of the car responsible for making sure the importer paid the tax?

What next? Cars to come wrapped in a paid excise tear strip. The buyers are supposed to call customs to check whether the importing company has smuggled it? Huh?

If you can afford a Lamborghini you also know the approximate price for a Lamborghini. Let's say it is appx. 20 million baht. If you as a buyer has paid somewhere remotely close to that amount, then you can reasonably argue that you thought everything was in order. I am sure there is a contract and a paper trail verifying the purchase price. However, if you as a buyer has only paid say 5 million baht, then you cannot reasonably argue that you did not know something illegal was going on, and you should therefore be prosecuted as an accomplice.

The same goes, at least in civilised countries, if someone offers you a brand new Iphone5 for say 50$ and you take the offer.

Basically I think you have to prove that you acted in good faith.

It is the importers who are liable, and I would think a bit of a stretch to prosecute the final buyers. Of course, if the paperwork is not in order that is another thing entirely. If however, someone has a stamp to show they paid the tax, but of course, they didn't, then whoever put the stamp on the document is in the poop, and that would be whichever pooyai keeps the stamp in the office. If it's all in order, and someone wants to sell me something for 5mn baht, who am I to say no?

Beyond that, how would i know that the car may have been imported in bits, and approved for entry by customs, and put back together by the importer? They would have to prove that the buyers were in on it.

[IMA_FARANG]

You know, as I'm a suspicious person, I just wonder if some of these luxury cars brought into Thailand on the sly might just have had there origin in the Middle east.

As an example, how many originated in .... let's just say...... Dubai.

Bet the DSI won't be interested in investigating that particular fact.

[Globeman]

Easy solution, confiscate smuggled cars and auction off to charity.

And who do you reckon shows up at the auction? An earlier scam was to have the car arrive at customs with a false delivery name and address... then, after six months or so of being unclaimed, it is - you guessed it - auctioned off without the taxes being paid... say, you don't suppose the buyer might be the same guy who shipped it to Thailand in the first place, do you?

[monkeycountry]

The rules for importing of a private vehicle are quite ridiculous. When I came to Thailand I owned a very nice, but old, BMWK110LT motor cycle which had taken me right around Europe a coule of times.

It's present market value was about $3,000 (14 years old) but on enquiring I would have had to pay close to $10,000 to legally import it for personal use. I bought it in the UK & subsequently shipped it back to Australia. At that time it was valued at $5,500 by the local BMW dealer - had to pay 10% of that price $550 as GST to land it in AUS.

Needless to say, it did not come to Thailand, but got sold via Ebay in AUS.

What is the point of Thailand taxes on such imports??

It's called Protectionism, Arrogance, and a desire to deny access by the average Thai to what is seen as high status items.

Maybe, maybe not.

In Denmark you will find similar tax rates on luxury cars, and most other cars for that matter, and you can hardly blame it on protectionism as Denmark does not have any car factories at all, so all cars are imported. In other words, there is no local car industry to protect in Denmark.