July 2024 / Thailand

The new criteria for customs clearance of imported goods valued at 1,500 Baht or less have been established in response to the government's policy aimed at addressing the issue of unfair pricing between overseas and local sellers. Overseas sellers were exempted from paying value added tax (VAT), while local sellers are required to pay it, creating an imbalance.

According to the Customs Department's announcement and effectively from July 5, 2024, imported goods with a total CIF value up to 1,500 Baht, previously VAT exempted, will be subject to 7% VAT. Such temporary measures will be valid until December 31, 2024 when legislation will supposedly close the loophole.

The de minimis regime will be still applied, but on customs duty exemption only.

Source: customs.go.th

On July 16, 2024, Thailand's Cabinet approved a 100 billion baht Soft Loan to facilitate easier access to loans for small and medium-sized enterprises (SMEs). The funds will be lent to commercial banks, enabling them to offer loans to SMEs at below-market rates. Mr. Pornchai Thiraveja, Director General of the Fiscal Policy Office, announced that the Soft Loan project has been in effect since April 2024.

The state-owned Government Savings Bank will provide Soft Loans to commercial banks at an interest rate of 0.01 percent per year for two years. These banks, in turn, will lend to SMEs at an interest rate not exceeding 3.5 percent per year for the same period. The maximum loan amount per SME is set at 40 million baht.

Sources: https://www.thaigov.go.th/news/contents/details/85886

https://www.thaigov.go.th/news/contents/details/85904

On July 9, 2024, Dr. Rak Vorrakitpokatorn, President of Export-Import Bank of Thailand (EXIM Thailand), and Mr. Narit Therdsteerasukdi, Secretary General of the Thailand Board of Investment (BOI), signed a Memorandum of Understanding at EXIM Thailand’s Head Office. This collaboration aims to promote and attract foreign direct investment (FDI) through financial support along the supply chains for Thai entrepreneurs seeking investment promotion from the BOI. The initiative encourages these businesses to enhance production efficiency, reduce greenhouse gas emissions, and transition to a low-carbon society.

Under this cooperation, EXIM Thailand offers financial products to BOI-promoted entrepreneurs with eco-friendly operations at special interest rates, including a 0.5% discount in the first year under the EXIM Green Goal and EXIM Solar D-Carbon Financing schemes. These schemes support investments in solar power generation systems, such as solar rooftops, solar farms, and solar floating systems, and include entitlements for carbon credit registration and certification.

Additionally, the EXIM Extra Transformation scheme targets exporters in S-curve industries, aiming to elevate Thai manufacturing sectors by financing the acquisition or improvement of machinery and equipment, or the extension, renovation, or construction of factory buildings or robotic and automatic systems. This initiative seeks to lower production costs, upgrade businesses, and improve production efficiency and capabilities through the use of new technologies.