Thailand is set to limit the online sale of foreign goods, particularly targeting Chinese imports, as concerns rise over the regional impact of cheap products flooding the market and hurting local manufacturers.
Following the weekly cabinet meeting on Tuesday, Prime Minister Srettha Thavisin announced that the cabinet had tasked Commerce Minister Phumtham Wechayachai to spearhead efforts to halt the influx of substandard foreign-made products into the country.
These efforts will involve collaboration with various agencies, such as the Finance Ministry, the Digital Economy and Society Ministry, the Industry Ministry, the Public Health Ministry, and the Royal Thai Police.
The goal is to help small Thai businesses adjust and thrive in both the physical and digital marketplaces. Proposals for these measures are expected by the end of August.
Government spokesperson Chai Wacharonke revealed that growing complaints from small and medium-sized enterprises (SMEs) about unfair trade practices by foreign companies, both online and offline, prompted the Prime Minister to instruct Mr. Phumtham to coordinate a response with relevant departments to establish clear, actionable strategies while supporting Thai SMEs.
“There have been growing complaints from the [Thai] private sector about illegal ‘grey’ businesses. These businesses have affected SMEs that are impacted by e-commerce, both online and offline.”
“It was found that there has been an unusually high influx of imported goods, with the e-commerce business valued at up to 1.53 trillion baht,” Mr. Chai said.
“The prime minister then ordered the Commerce Ministry to take the lead in coordinating this matter, which will involve checking business licenses and ensuring businesses are properly registered as legal entities.”
He added that inspections would be conducted to ensure compliance with product standards, involving the Food and Drug Administration (FDA) and industrial product standards to safeguard Thai consumers.
The Consumer Protection Board will work alongside the FDA, and there will be checks on import licenses to verify that import taxes and duties are properly paid.
The measures will also include the issuance of factory establishment permits, taking into account international trade agreements, Mr. Chai noted.
He mentioned that the Commerce Ministry is evaluating effective measures, noting that China has implemented controls on e-commerce, such as restrictions on the number of items that can be purchased online annually and caps on annual spending.
Regarding imports, a 7% value-added tax (VAT) is applied in Thailand on imported goods priced between 1 and 1,500 baht, with additional VAT and import duties on goods priced between 1,500 and 40,000 baht. Goods over 40,000 baht are taxed based on product classification.
In a related note, Mr. Phumtham posted on his personal Facebook page regarding Temu, a significant Chinese e-commerce platform that offers inexpensive products directly from manufacturers without intermediaries.
He observed that while Temu presents both opportunities and challenges, its market entry is noteworthy and has a profound impact on local SMEs due to its substantial market presence.
To protect against the import of substandard or hazardous products and to promote fair competition, the government is also considering tax measures for e-commerce to ensure that international platforms are taxed fairly and do not harm the Thai economy, he concluded.
