Revenue Department told to urge Temu to register for tax system

Deputy Finance Minister Julapun Amornvivat has instructed the Revenue Department to reach out to the Chinese e-commerce platform Temu, which recently entered the Thai market, to encourage it to register for the tax system. 

Kulaya Tantitemit, director general of the Revenue Department, said the department has contacted Temu via email, advising it to register as a taxpayer according to Thai law. 

"Currently, Temu does not fall under the legal requirements for VAT [value-added tax] registration in Thailand, making it impossible to force VAT registration on them," Kulaya said.

Temu is an e-commerce platform that sells products directly from overseas without involving Thai intermediaries or allowing local businesses to operate stores on the platform. As a result, it is not subject to the VAT for Electronic Services (VES) that applies to foreign platforms with local operators. 

Unlike other platforms with Thai businesses, which are required to pay VAT to the Revenue Department, Temu is not yet required to do so.

Imported goods from Temu are subject to 7% VAT, as per the standard procedure for imported goods valued under 1,500 baht. If future policies require the Revenue Department to take further action on Temu's tax obligations, the department is prepared to take necessary steps.

Meanwhile, Minister of Commerce Phumtham Wechayachai said the ministry, led by its permanent secretary, has convened meetings with relevant agencies, including the Ministry of Finance (Customs and Revenue Departments), the Ministry of Digital Economy and Society (responsible for platform regulation), the Ministry of Industry (overseeing product standards), and the Ministry of Public Health (responsible for FDA standards). 

The meetings aimed to find solutions to the issue of substandard and low-cost imports flooding into the country through e-commerce channels and various checkpoints. 

The discussions focused on whether these practices constitute dumping, and the applicable regulations, including World Trade Organization guidelines. 

The primary goal is to protect Thai products based on existing laws, rather than engaging in retaliatory measures, acknowledging that such actions could affect international trade relations, particularly with China, to which Thailand exports agricultural products.

Phumtham, who also is deputy prime minister, said: “In personal discussions with the Chinese ambassador to Thailand, the ambassador also expressed concern and a willingness to work together to find solutions. 

“It was noted that the trend of mutual market penetration between China and Thailand is a hallmark of modern international trade. While China has the right to enter the Thai market, Thailand also has the duty to protect its interests. 

“However, any retaliatory measures could lead to reciprocal actions from China, potentially hindering international trade."