Customs addresses local content loophole

Fines for false ‘Made in Thailand’ claims

- WICHIT CHANTANUSORNSIRI

A worker cans food in a factory. The Customs Department plans to ban imported agricultural products from qualifying for the 40% local content import duty exemption for domestic sale based on any processing in Thailand.

The Customs Department looks set to amend regulations on local content to prevent imported goods from exploiting tax privileges to compete with domestic producers.

The effort also seeks to tighten controls against the false use of the “Made in Thailand” label for exports, especially to the US.

According to Phantong Loykulnanta, director-general of the department, imported goods, whether stored in a free zone or not, are eligible for an import duty exemption if their local content can be increased to 40% and the products are sold in Thailand.

If the same goods are reexported, they can be claimed as “Made in Thailand”.

The local content criteria were last revised during the administration of the National Council for Peace and Order, stipulating the local content designation required a specific manufacturing process carried out in Thailand — not merely the addition of domestic profit and labour costs.