MoF implements VAT collection for cheap imported goods to level playing field with domestic sellers

The Ministry of Finance has announced a new policy aimed at addressing the discrepancy in VAT obligations between foreign and domestic sellers, thereby promoting fairness in consumer transactions. This initiative addresses the competitive disadvantage faced by Thai sellers due to the current VAT exemption on low-value imports, particularly from Chinese sellers. This policy aligns with international agreements stipulating minimum thresholds for customs duties on imported goods, which are intended to benefit Thailand's economy.

Under the Customs Tariff Emergency Decree of 1987, the Minister of Finance, with Cabinet approval Thailand will impose a 7% value-added tax (VAT) on low-value consignments of goods imported directly to consumers entering into force on 5 July 2024. Previously, items valued at or below 1,500 baht were exempt from VAT. Initially, the Customs Department will manage the VAT collection until December 31, 2024, after which the Revenue Department will assume this responsibility. Amendments to the Revenue Code are underway to support this transition. This policy will remain effective until December 31, 2024, after which a new law will ensure the continued collection of VAT on these products.

25 June 2024

Source: Ministry of Finance Announcement