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


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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.

There were few assembly plants here 15 years ago, and the high import taxes encouraged manufacturers to set up shop here to get better access to the market at a reasonable price.

And do you really think the massive tax on luxury cars is somehow unfair? Most of the people who can afford them enjoy their wealth through a game rigged very much in their favour in the first place... nice to see they have to at least pay for something.

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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.

There were few assembly plants here 15 years ago, and the high import taxes encouraged manufacturers to set up shop here to get better access to the market at a reasonable price.

And do you really think the massive tax on luxury cars is somehow unfair? Most of the people who can afford them enjoy their wealth through a game rigged very much in their favour in the first place... nice to see they have to at least pay for something.

It's the government's way of taxing the rich in Thailand because so few people declare their real income. It's quite clever actually. I mean what is the point in being super rich if you can't have a ferrari. You want you pay, through the nose....... Unless you rig the system as these guys apparently have been doing.

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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.

I admit that I do not know the rules in Thailand, but I do know that if you buy brand new stuff at ridiculously low prices in my home country, then you can be prosecuted. We can make the example more extreme if you like, just to clarify my point. Say the seller wants to sell you a brand new Lamborghini for 1000$ (yes I know if is unlikely), and all the tax stamps are on the papers (perhaps fake, but they look real). If you buy this car, you will be in trouble as no judge will believe you did not know you were buying illegal goods.

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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.

blabbering mouths can't give an example! rule of thumb in the Baht 5 million price range is "grey import ~10-12% cheaper than authorised dealer". however, this percentage increases exponentially at higher price ranges.

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To repost a previous post somewhere else. Grey market works in a variety of ways.

1. import a car and simply pay off an official to allow it to come in at a lower valuation than it should - cost saving shared between seller and a little with the buyer

2. import a 2nd hand car and bring in as 'parts' then reassemble the car; in some cases can be actual parts in other cases just a few things removed; depends how malleable the official is on this; the assemblers are often the car mechanics of that brand moonlighting (I know this to be the case with one brand in particular that the car actually has come in many little parts mixed and matched); I think the emotional idea of someone playing around in their house trying to put a Lambo back together is a far cry from the reality; that said I wouldn't buy one

3. add something to the car to take advantage of different tax code; e.g. no seats in a van to make it a commercial vehicle; extra seats in a sportscar to make it a 4 seater; gas to make it an NGV

4. misclaim information about the car to take advantage of a different tax code e.g. Mini Cooper S JCW declared as a Mini Cooper; Mitsu Evo declared as a Lancer; very common with grey market Porsches how many are non turbos on paper

5. issue duplicate papers for 2 cars that are the same and pay tax once, one legit one copy, and sell them both usually 2nd one is sold way cheap with the understanding that it is a dodgy title; this is a 'politician's son car' as you need a signature of a phoo yai to stay out of trouble; easy giveaway is usually comes in via a small private port and is often a car that fits in a container

6. bring in an uncommon car and thus grey market is the only choice since legit importers selling the same model have to also carry all the spare parts etc to service the brute but there are almost no chances to make money out of servicing this is the case with the big engine AMGs, Audi TT, Audi R8 - the cost of being the legit dealer ends up far higher than being a grey importer who has more volume and thus can lower the price and thus has more volume

7. bring in a car that is easily tuned, and sell it and bring in unturned, then tune it here (the reason why the same VW family also owns ABT, APR, MTM and why Millenium has AC Schnitzer) - not really a grey trick, rather a generally cool trick to get around HP restrictions

8. bring in a stolen car - difficult and I think doesn't happen much (as the VIN is tracked in the shipment at both ends)

9. bring in a clocked car with the mileage wound back at the Thai end before sale (similar to other countries with Japanese imports; cars are sold as if they did 40,000km, actually have done 80,000km, everyone wins, official paid to turn a blind eye on the paperwork upon arrival; also happens for cars that are 2nd hand being claimed as new and then picked up in the diagnostics (I know from BMW that Munich's system has identified issues where BMWs have had 2 10,000km check ups - one legit and the 2nd as a result of a wind back)

I think it's common knowledge that grey used to be mostly for exotic models only, and there were only a few big players. The massive proliferation really started to take off in 2007 onwards as a source of money not only for politics but also as policy swung back and forth opening opportunities combined with increasing purchasing power and a lot of 'grey money'. I'd guess most of the big grey dealers know 'the boss' in Dubai, and more than a few have direct connections. It is not surprise that Laem Chabang port license was issued and is beholden to 'the boss' in Dubai and whoever controls the port and the customs department controls the rate at which grey flourishes (or dies).

At the same time, the push has been to help the local industry for Toyota especially (again connected more so to TRT/PPP via Mingkwan, Thai Summit etc) rather than the Euro brands since it is a big hirer and also vote winner (hence the first car policy tilted towards only really helping Toyota, Honda rather than the Euro brands). Since grey is a big money earner, no doubt the Dems government BJT were cashing in big time too, which is why no government has really tried to stop it; like rice pledging the money is addictive and the benefits are concentrated while the costs to society are very spread out.

The big political families and their backers on both sides, many are driving cars which are grey. The connections enabling this business run long and deep, and the money is big. The servicing aspect is also a historic one; many of the grey dealers of Benz, for instance, Benz Amorn, BRG, CarMax Rama 9 are all formerly Benz dealers taken out I think in the 1997/98 crash. Grey is their way to reappear like a phoenix rising from the ashes.

Edited by steveromagnino
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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.

There were few assembly plants here 15 years ago, and the high import taxes encouraged manufacturers to set up shop here to get better access to the market at a reasonable price.

And do you really think the massive tax on luxury cars is somehow unfair? Most of the people who can afford them enjoy their wealth through a game rigged very much in their favour in the first place... nice to see they have to at least pay for something.

It's the government's way of taxing the rich in Thailand because so few people declare their real income. It's quite clever actually. I mean what is the point in being super rich if you can't have a ferrari. You want you pay, through the nose....... Unless you rig the system as these guys apparently have been doing.

But these takes don't just apply to cars in the 10mil plus bracket. Even something like a Subaru, falls under this tax scheme. So a 1mil baht Subabru in Australia, costs you close to 3 mil here. It's all cars that are imported, start with a high rate, which has add on's based on, high performance etc.

In the west, so few rich people pay anywhere near the tax through should, ie tax deductions, etc etc (which are everything they could ever think of), yet they don't have this huge luxury car taxes (Australia does have a luxury car tax, but it's something like 5-10%, can't remember exactly). Not 250%.

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To repost a previous post somewhere else. Grey market works in a variety of ways.

1. import a car and simply pay off an official to allow it to come in at a lower valuation than it should - cost saving shared between seller and a little with the buyer

2. import a 2nd hand car and bring in as 'parts' then reassemble the car; in some cases can be actual parts in other cases just a few things removed; depends how malleable the official is on this; the assemblers are often the car mechanics of that brand moonlighting (I know this to be the case with one brand in particular that the car actually has come in many little parts mixed and matched); I think the emotional idea of someone playing around in their house trying to put a Lambo back together is a far cry from the reality; that said I wouldn't buy one

3. add something to the car to take advantage of different tax code; e.g. no seats in a van to make it a commercial vehicle; extra seats in a sportscar to make it a 4 seater; gas to make it an NGV

4. misclaim information about the car to take advantage of a different tax code e.g. Mini Cooper S JCW declared as a Mini Cooper; Mitsu Evo declared as a Lancer; very common with grey market Porsches how many are non turbos on paper

5. issue duplicate papers for 2 cars that are the same and pay tax once, one legit one copy, and sell them both usually 2nd one is sold way cheap with the understanding that it is a dodgy title; this is a 'politician's son car' as you need a signature of a phoo yai to stay out of trouble; easy giveaway is usually comes in via a small private port and is often a car that fits in a container

6. bring in an uncommon car and thus grey market is the only choice since legit importers selling the same model have to also carry all the spare parts etc to service the brute but there are almost no chances to make money out of servicing this is the case with the big engine AMGs, Audi TT, Audi R8 - the cost of being the legit dealer ends up far higher than being a grey importer who has more volume and thus can lower the price and thus has more volume

7. bring in a car that is easily tuned, and sell it and bring in unturned, then tune it here (the reason why the same VW family also owns ABT, APR, MTM and why Millenium has AC Schnitzer) - not really a grey trick, rather a generally cool trick to get around HP restrictions

8. bring in a stolen car - difficult and I think doesn't happen much (as the VIN is tracked in the shipment at both ends)

9. bring in a clocked car with the mileage wound back at the Thai end before sale (similar to other countries with Japanese imports; cars are sold as if they did 40,000km, actually have done 80,000km, everyone wins, official paid to turn a blind eye on the paperwork upon arrival; also happens for cars that are 2nd hand being claimed as new and then picked up in the diagnostics (I know from BMW that Munich's system has identified issues where BMWs have had 2 10,000km check ups - one legit and the 2nd as a result of a wind back)

I think it's common knowledge that grey used to be mostly for exotic models only, and there were only a few big players. The massive proliferation really started to take off in 2007 onwards as a source of money not only for politics but also as policy swung back and forth opening opportunities combined with increasing purchasing power and a lot of 'grey money'. I'd guess most of the big grey dealers know 'the boss' in Dubai, and more than a few have direct connections. It is not surprise that Laem Chabang port license was issued and is beholden to 'the boss' in Dubai and whoever controls the port and the customs department controls the rate at which grey flourishes (or dies).

At the same time, the push has been to help the local industry for Toyota especially (again connected more so to TRT/PPP via Mingkwan, Thai Summit etc) rather than the Euro brands since it is a big hirer and also vote winner (hence the first car policy tilted towards only really helping Toyota, Honda rather than the Euro brands). Since grey is a big money earner, no doubt the Dems government BJT were cashing in big time too, which is why no government has really tried to stop it; like rice pledging the money is addictive and the benefits are concentrated while the costs to society are very spread out.

The big political families and their backers on both sides, many are driving cars which are grey. The connections enabling this business run long and deep, and the money is big. The servicing aspect is also a historic one; many of the grey dealers of Benz, for instance, Benz Amorn, BRG, CarMax Rama 9 are all formerly Benz dealers taken out I think in the 1997/98 crash. Grey is their way to reappear like a phoenix rising from the ashes.

Much of what you say is quite correct.

Benz Amorn have never been Authorised dealers, at least that's what they tell me. BRG & Car Max certainly were and run exceptionally professional operations.

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How about stop charging this ridiculous level of tax to imported cars (300% for cars above 2.5L or above 220 HP) and let the people buy better cars easily. Why is the government making it so hard for people to afford a car with these ridiculous 7-8 year loans instead of actually helping people afford something they want? Or has the Big Japanese manufacturers with factories in Thailand gotten a little too close to the government?

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Nothing wrong with luxury taxes on cars, taxing goods where there is an inelastic demand is economics 101.

Those crying over the cost are also forgetting that cars generally hold their value quite wel in Thailand. Sure the number is bigger, but so is the sale price.

Lastly, why would you lower the cost of cars and encourage even more traffic? Thailand needs more cars like a hole in the head.

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Nothing wrong with luxury taxes on cars, taxing goods where there is an inelastic demand is economics 101.

Those crying over the cost are also forgetting that cars generally hold their value quite wel in Thailand. Sure the number is bigger, but so is the sale price.

Lastly, why would you lower the cost of cars and encourage even more traffic? Thailand needs more cars like a hole in the head.

Lamborghini's only cost about 3-4 million baht in Europe and the US so why does it cos 30-40 million here? Why are you stopping people from buying BMW instead of pretty much forcing them to buy Toyota and Isuzu. The safety of these cars are also a lot better which may mean less deaths with better cars, that's why Germany has its autobahn, because of the trust in their cars. Of course less cars is the eventual goal, but outside of Bangkok, cars are still pretty much a necessity. The traffic situation in Bangkok can be dealt with a congestion charge and better and reliable public transport. In cities like Vancouver, people can easily afford luxury cars but they still choose to use public transport during the weekdays and only use their cars in the evenings or weekends for leisure.

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Nothing wrong with luxury taxes on cars, taxing goods where there is an inelastic demand is economics 101.

Those crying over the cost are also forgetting that cars generally hold their value quite wel in Thailand. Sure the number is bigger, but so is the sale price.

Lastly, why would you lower the cost of cars and encourage even more traffic? Thailand needs more cars like a hole in the head.

Lamborghini's only cost about 3-4 million baht in Europe and the US so why does it cos 30-40 million here? Why are you stopping people from buying BMW instead of pretty much forcing them to buy Toyota and Isuzu. The safety of these cars are also a lot better which may mean less deaths with better cars, that's why Germany has its autobahn, because of the trust in their cars. Of course less cars is the eventual goal, but outside of Bangkok, cars are still pretty much a necessity. The traffic situation in Bangkok can be dealt with a congestion charge and better and reliable public transport. In cities like Vancouver, people can easily afford luxury cars but they still choose to use public transport during the weekdays and only use their cars in the evenings or weekends for leisure.

Because toyota employs thousands of Thais. I don't like it, but that's the policy Thailand has.

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There seems to be a race going on to strip Thailand of its forests and wildlife, ruin its people with Ya ba and with the money buy luxury cars.

Is the future of Thailand to become a desert country filled with modern junk, buildings and people who have ruined their health?

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Nothing wrong with luxury taxes on cars, taxing goods where there is an inelastic demand is economics 101.

Those crying over the cost are also forgetting that cars generally hold their value quite wel in Thailand. Sure the number is bigger, but so is the sale price.

Lastly, why would you lower the cost of cars and encourage even more traffic? Thailand needs more cars like a hole in the head.

Lamborghini's only cost about 3-4 million baht in Europe and the US so why does it cos 30-40 million here? Why are you stopping people from buying BMW instead of pretty much forcing them to buy Toyota and Isuzu. The safety of these cars are also a lot better which may mean less deaths with better cars, that's why Germany has its autobahn, because of the trust in their cars. Of course less cars is the eventual goal, but outside of Bangkok, cars are still pretty much a necessity. The traffic situation in Bangkok can be dealt with a congestion charge and better and reliable public transport. In cities like Vancouver, people can easily afford luxury cars but they still choose to use public transport during the weekdays and only use their cars in the evenings or weekends for leisure.

Nothing is stopping people buying these cars. But if they want one, they are going to have to pay a super luxury tax - as is the law in Thailand. Plenty of people do and they would do so regardless of the tax regieme.

As for the comment about deaths on roads, I suspect there is more to do with driving standards.

And yes, finally, rightly or wrongly, the government wants to protect its local car industry.

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At least in Thailand you can get locally made foreign cars at a lower price. They have the same scam going in Malaysia to protect the 'Proton' industry.

Considering they are locally made, with local wage levels they are very expensive by the time the government lobs it's tax on them.

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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 a buyer of a luxury car pays THB 3m instead of THB 8m he may be held responsible, because he is supposed to know that such a price-difference isn't normal.

If a buyer of a luxury car pays THB 8m for a THB 8m-car, then you may suppose that he is not aware of the scam behind the scene.

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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 a buyer of a luxury car pays THB 3m instead of THB 8m he may be held responsible, because he is supposed to know that such a price-difference isn't normal.

If a buyer of a luxury car pays THB 8m for a THB 8m-car, then you may suppose that he is not aware of the scam behind the scene.

If you buy it from a grey market dealer, the savings are about 10 to 20% depending on the value of the car. At the end of the day, it is possible to pick up a 2 or 3 year old super car in the UK, or a very high end Merc for very good prices at the moment because the economy is in the crap. So, buy a one or two year old low mileage Merc that new may have been 100k GBP new (with 20% VAT which can be claimed back anyway for export), but today is only 50 or 60k GBP. The mileages that these things do around the South East of England are sometimes miniscule.

Since the tax is expressed as a percentage, it is automatically half price, against a brand new one bought through the main dealer in Thailand. I know, a friend of mine does exactly this business LEGITIMATELY in Thailand, sourcing cars to spec for private buyers in Thailand. Taxes paid, and Bob's your uncle.

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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 a buyer of a luxury car pays THB 3m instead of THB 8m he may be held responsible, because he is supposed to know that such a price-difference isn't normal.

If a buyer of a luxury car pays THB 8m for a THB 8m-car, then you may suppose that he is not aware of the scam behind the scene.

If you buy it from a grey market dealer, the savings are about 10 to 20% depending on the value of the car. At the end of the day, it is possible to pick up a 2 or 3 year old super car in the UK, or a very high end Merc for very good prices at the moment because the economy is in the crap. So, buy a one or two year old low mileage Merc that new may have been 100k GBP new (with 20% VAT which can be claimed back anyway for export), but today is only 50 or 60k GBP. The mileages that these things do around the South East of England are sometimes miniscule.

Since the tax is expressed as a percentage, it is automatically half price, against a brand new one bought through the main dealer in Thailand. I know, a friend of mine does exactly this business LEGITIMATELY in Thailand, sourcing cars to spec for private buyers in Thailand. Taxes paid, and Bob's your uncle.

In theory, it is illegal to import used cars into Thailand, although it's often done. I'm not sure how your friend can do this business legitimately, unless using some the questionable loopholes mentioned earlier in some of these similar threads about the same subject.

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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 a buyer of a luxury car pays THB 3m instead of THB 8m he may be held responsible, because he is supposed to know that such a price-difference isn't normal.

If a buyer of a luxury car pays THB 8m for a THB 8m-car, then you may suppose that he is not aware of the scam behind the scene.

If you buy it from a grey market dealer, the savings are about 10 to 20% depending on the value of the car. At the end of the day, it is possible to pick up a 2 or 3 year old super car in the UK, or a very high end Merc for very good prices at the moment because the economy is in the crap. So, buy a one or two year old low mileage Merc that new may have been 100k GBP new (with 20% VAT which can be claimed back anyway for export), but today is only 50 or 60k GBP. The mileages that these things do around the South East of England are sometimes miniscule.

Since the tax is expressed as a percentage, it is automatically half price, against a brand new one bought through the main dealer in Thailand. I know, a friend of mine does exactly this business LEGITIMATELY in Thailand, sourcing cars to spec for private buyers in Thailand. Taxes paid, and Bob's your uncle.

In theory, it is illegal to import used cars into Thailand, although it's often done. I'm not sure how your friend can do this business legitimately, unless using some the questionable loopholes mentioned earlier in some of these similar threads about the same subject.

You have to pay a tonne of tax upfront at the port and register it.

He imports to order.

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If you buy it from a grey market dealer, the savings are about 10 to 20% depending on the value of the car. At the end of the day, it is possible to pick up a 2 or 3 year old super car in the UK, or a very high end Merc for very good prices at the moment because the economy is in the crap. So, buy a one or two year old low mileage Merc that new may have been 100k GBP new (with 20% VAT which can be claimed back anyway for export), but today is only 50 or 60k GBP. The mileages that these things do around the South East of England are sometimes miniscule.

Since the tax is expressed as a percentage, it is automatically half price, against a brand new one bought through the main dealer in Thailand. I know, a friend of mine does exactly this business LEGITIMATELY in Thailand, sourcing cars to spec for private buyers in Thailand. Taxes paid, and Bob's your uncle.

In theory, it is illegal to import used cars into Thailand, although it's often done. I'm not sure how your friend can do this business legitimately, unless using some the questionable loopholes mentioned earlier in some of these similar threads about the same subject.

You have to pay a tonne of tax upfront at the port and register it.

He imports to order.

That may well be the case,as 'paying a tonne of tax' is a given, but the fact remains, used car imports are illegal in Thailand, with the exception of personal imports which have a whole raft of conditions, especially concerning length of ownership abroad and time out of the country for Thai nationals, etc, etc. Doesn't seem too easy for him to do what you say he does, without bending some rules. Legitimate?, I doubt it.

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If you buy it from a grey market dealer, the savings are about 10 to 20% depending on the value of the car. At the end of the day, it is possible to pick up a 2 or 3 year old super car in the UK, or a very high end Merc for very good prices at the moment because the economy is in the crap. So, buy a one or two year old low mileage Merc that new may have been 100k GBP new (with 20% VAT which can be claimed back anyway for export), but today is only 50 or 60k GBP. The mileages that these things do around the South East of England are sometimes miniscule.

Since the tax is expressed as a percentage, it is automatically half price, against a brand new one bought through the main dealer in Thailand. I know, a friend of mine does exactly this business LEGITIMATELY in Thailand, sourcing cars to spec for private buyers in Thailand. Taxes paid, and Bob's your uncle.

In theory, it is illegal to import used cars into Thailand, although it's often done. I'm not sure how your friend can do this business legitimately, unless using some the questionable loopholes mentioned earlier in some of these similar threads about the same subject.
You have to pay a tonne of tax upfront at the port and register it.

He imports to order.

That may well be the case,as 'paying a tonne of tax' is a given, but the fact remains, used car imports are illegal in Thailand, with the exception of personal imports which have a whole raft of conditions, especially concerning length of ownership abroad and time out of the country for Thai nationals, etc, etc. Doesn't seem too easy for him to do what you say he does, without bending some rules. Legitimate?, I doubt it.

Illegal if declared as parts. Declare it as a car and it can come in. But you have obviously to pay the tax.

Can't paste the customs link because an on the phone.

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