Thai businesses back higher online import duties but call for stronger safeguards

Thailand is moving to raise import duties on goods purchased through overseas e-commerce platforms to a maximum of 30%, aiming to help domestic small and medium-sized enterprises (SMEs) compete with cheaper foreign products, particularly those sold through Chinese online platforms.

The Cabinet has approved revised customs rules covering express deliveries and international postal shipments, with implementation expected in early 2027.

The changes are intended to address differences in operating costs between Thai businesses and overseas online sellers, while strengthening consumer protection against imported products that fail to meet domestic standards.

Deputy Prime Minister and Finance Minister Ekniti Nitithanprapas explained that technological advances had allowed foreign businesses to sell directly to Thai consumers without relying on domestic supply chains.

Unlike local operators, these sellers often avoid expenses associated with physical shops, employment and corporate income tax in Thailand, creating an uneven competitive environment.

Import duties capped at 30%, depending on product category

Customs Department Director-General Phantong Loykulnanta explained that the government would remove general import-duty reductions and exemptions under Section 12 of the Customs Tariff Decree of 1987.

Instead, imported goods would be taxed according to the statutory tariff ceiling for each product category, subject to an overall maximum of 30%.

The change does not mean every imported product will face a 30% duty.

Goods with a statutory tariff ceiling below 30% will be charged at that rate. For example, interchangeable hand tools with a 25% ceiling will remain subject to a 25% duty.

Products whose statutory ceilings exceed 30% will be subject to a maximum duty of 30%.

The measures cover express imports declared under consolidated shipping documents, goods released from e-commerce free zones for domestic use or sale, and international postal imports subject to customs declarations.

However, containerised imports and shipments benefiting from preferential tariffs under free trade agreements (FTAs) will continue to follow existing customs procedures.

The distinction reflects the government's assessment that bulk imports still contribute to the domestic economy through employment, warehouse rentals and other business activities, whereas overseas e-commerce parcels often reach consumers directly.

The Finance Ministry will also work with online platforms to obtain shipment information in advance, improving the accuracy of customs declarations and simplifying collection procedures.

Higher duties for electronics, accessories and household goods

Several categories among the 20 most frequently ordered imported products are expected to face substantial duty increases.

The rate on plastic products will rise from 10% to 30%, while imitation jewellery, including earrings and necklaces, will increase from zero to 30%.

Women's handbags will face a rise from 20% to 30%, while fitness equipment will increase from 10% to 30%.

Duties on mobile phone screen protectors will rise from 5% to 30%, and communications equipment and components from zero to 30%.

Headphones, speakers and microphones will face an increase from 10% to 30%, while sunglasses will rise from 5% to 30%.

The revised rates build on measures introduced in January 2026 requiring imported goods valued from THB1 to pay import duty and value-added tax (VAT).

Customs revenue expected to increase by THB6.3 billion annually

The Customs Department estimates that the revised system will generate approximately THB6.3 billion in additional import duties each year.

In the previous fiscal year, duties collected from online parcels totalled THB4.8 billion, alongside THB3.5 billion in VAT revenue.

The additional customs revenue is expected to raise annual import-duty collections from online shipments to approximately THB11.1 billion.

The changes come as the volume of international parcels entering Thailand continues to rise sharply.

Imports increased from 134.1 million parcels in 2024 to 168.4 million in 2025, representing growth of 25.58%.

The department expects the figure to reach 241 million parcels for fiscal 2026, an increase of 43.11%.

Officials also believe the measures could improve consumer protection, as some products purchased directly from overseas platforms have not undergone checks required by the Thai Industrial Standards Institute (TISI) or the Thai Food and Drug Administration (FDA).

Thai manufacturers welcome stronger protection

Pimjai Leeissaranukul, chairwoman of the Federation of Thai Industries (FTI), told Krungthep Turakij that the policy represented important support for Thai SMEs struggling to compete with lower-priced imported goods.

She believes higher duties will narrow the price gap and give local manufacturers an opportunity to regain market share.

"If Thai SMEs can compete and recover even half of the market, equivalent to around 120 million items, or make a full effort and reclaim all 241 million items, it would generate enormous sales and restore substantial purchasing power," she remarked.

Pimjai argued that the resulting increase in imported product prices could improve the competitiveness of domestic businesses.

Noppong Teeravorn, president of the Thai SME Federation, also welcomed the decision, describing it as an important step towards fairer competition for micro, small and medium-sized enterprises (MSMEs).

He noted that low-cost goods sold through Chinese e-commerce platforms had benefited from tax exemptions while avoiding many expenses borne by Thai businesses, including shop rentals, employment costs and domestic income tax.

Increasing duties on products such as plastic goods, communications equipment and imitation jewellery would help narrow the price difference between Chinese imports and domestically produced goods, he argued.

Consumer protection and domestic supply chains

Noppong identified three broader economic benefits from the revised customs arrangements.

First, higher import-duty collections would increase government revenue, with the Customs Department forecasting an additional THB6.3 billion annually.

Second, the policy would help protect domestic supply chains by concentrating the changes on smaller cross-border parcels delivered directly to consumers, while maintaining existing arrangements for conventional bulk imports and shipments covered by FTAs.

Third, he viewed the initiative as consistent with international efforts to address tax advantages enjoyed by low-value imported goods.

He pointed to measures being adopted by the European Union and the United States to close tax loopholes, arguing that Thailand also needed to prevent its market from becoming an outlet for excess production from other countries.

Noppong added that stricter controls could help prevent substandard products from undercutting legitimate businesses, while reducing potential risks to consumers from goods that lack TISI certification or FDA approval.

Import duties alone will not solve competition problems

Visit Limlurcha, vice-chairman of the Thai Chamber of Commerce and president of the Thai Future Food Trade Association, cautioned that higher import duties could provide only temporary relief.

He explained that overseas manufacturers benefiting from substantially larger production volumes might still offer goods at prices below those of Thai producers, even after a 30% import duty.

He also called for tighter supervision of products entering Thailand through shipping containers and being stored in free zones, which fall outside the main focus of the revised parcel-duty arrangements.

Visit stressed that import-duty measures must be accompanied by stronger law enforcement.

All imported products should comply with the same industrial and food safety standards required of domestically manufactured goods, he argued.

He also urged Thai SMEs to improve their competitiveness by developing higher-value products and investing in innovation.

In his view, import duties would merely buy time for domestic businesses to strengthen their operations, rather than provide a lasting solution to competition from overseas manufacturers.