New import tax to level field amidst flood of foreign goods

Measures also help authorities hungry for revenue.

- By Wichit Chantanusornsiri

Starting from Jan 1 this year, all goods ordered online and imported into Thailand are subject to both import duty and value-added tax (VAT).

The Customs Department eliminated the minimum tax-exempt value (de minimis value), which was 1,500 baht. The measure is intended to ensure fairer trade competition and improve the efficiency of government revenue collection.

Industry observers and online shoppers are looking to see if prices for products ordered on online platforms will increase.

Once taxes are imposed, the price paid by consumers will inevitably rise because import duties vary by product category, generally ranging from 10-30% of the cost, insurance and freight value, with an additional 7% VAT applied.

However, online platforms that import goods for sale in Thailand are expected to adapt to retain their customer base amid intense competition.

Lazada, one of Thailand's largest online marketplaces, said sellers will likely adjust to the new tax regime in order to remain competitive.

Thamakorn Supathanarangsri, vice-president and head of government affairs at Lazada, said online platforms will inevitably need to adapt because tax obligations increase product costs. To retain customers, platforms may employ marketing strategies such as buy-one, get-one-free promotions or membership programmes offering additional benefits.

She said while the new tax measures help create a more level playing field between domestic and foreign sellers, they may negatively affect consumers who rely on certain essential imported goods as they will have to bear higher prices.