8 July 2020
Thailand’s Customs Department has extended the deadline for business operators to pay all outstanding taxes and import duties at the Post-Clearance Audit Division of the Customs Department. The Customs Department has also extended the deadline for requesting review of import duty penalties, fines, and surcharges on outstanding import duty amounts until September 30, 2021—a significant postponement of the previous deadline of April 30, 2020.
This extension is meant to ease the burden of honest business operators who have paid incorrect or incomplete import duty and tax, giving them a chance to review previous import duty and tax payments and take steps to address underpayment. This extension is under the Customs Department’s One Stop Service project, which allows business operators to pay outstanding taxes and import duties through the One Stop Service Center at the Post-Clearance Audit Division office of the Customs Department in Bangkok.
The One Stop Service project was originally open to businesses from April 1, 2018, to April 30, 2019, during which more than 150 business operators joined and met the required qualifications. In response to this success, the Customs Department agreed to open a second period from May 15, 2019, to April 30, 2020, which has now been extended to September 30, 2021.
One Stop Service Project
This is an important matter for any person involved with incomplete duty or tax, as section 202 of Customs Act B.E. (2560) 2017 stipulates that submitting incorrect or incomplete declarations, documentation, or other duty-related information is punishable by a fine of up to THB 500,000.
Typically, import duty penalties, fines, and surcharges on outstanding import duty—including value added tax (VAT) surcharges and penalties—are payable by business operators without review. Business operators who join the One Stop Service scheme, however, will be given the right to review these charges.
The One Stop Service project gives business operators who have paid incomplete tax and duty, despite operating in good faith, an opportunity to rectify payments themselves by submitting a letter to the project coordinator (i.e., the Post-Clearance Audit Division) with the required documents. After review, if there is no evidence that the business operator was dishonest, the business operator will receive the right to review the import duty penalty, fine, and surcharge on the outstanding import duty and petition the Customs Department to consider waiving or reducing the applicable charges. Nevertheless, business operator still have the obligation to pay all charges that are not covered by this project, such as VAT surcharges and related penalties.
However, any importer who has smuggled items into Thailand (with clear evidence of dishonest or fraudulent evasion of the duty or tax owed), imported prohibited or restricted items, or imported goods that violate intellectual property rights, is not eligible to join the project. Ongoing post-audit inspections, investigations, or prosecutions by the Department of Investigation, the Economic Crime Division, or another authorized entity, are also ineligible for the One Stop Service, as are any cases currently under consideration of the Board of Appeal or undergoing litigation procedures.
The Customs Department’s One Stop Service project is greatly beneficial to business operators who have operated in good faith but have ended up reporting incorrect or incomplete amounts, and the project indicates the Customs Department’s desire to foster positive relationships with business operators by easing some of the challenges associated with customs. If the Customs Department further loosens their restrictions on participation in the project—such as by allowing inclusion of cases undergoing post-audit inspection or investigation or extending to cover other charges–they would provide more opportunities for settlement and continue to build up good relations with business operators.
For further information, please contact:
Kasamesunt Teerasitsathaporn, Partner, Tilleke & Gibbins
