Shocking details of
Thailand's customs
laws
and the need for reform
By Jon Fernquest 
Most
people probably do not know how the Customs Department in Thailand
operates.For example, that customs officials are motivated by personal gain rather than purely by justice in resolving cases.
By law they stand to personally gain money and wealth in the cases they investigate if they find suspects guilty.
An op-ed piece in the business section this week revealed all the shocking details.
customs
- the government agency that controls goods coming into and going out
of the country and collects taxes on them กรมศุลกากร
reform - improvement, changes to correct a situation that is wrong or unfair การแก้ไข การปฏิรูป
X motivated by Y - Y causes X to act the way they do
personal gain - when you yourself make money (not what your employer or the public that you serve as a civil servant usually wants)
purely by - only by
justice - fairness in the way people are treated
resolving - solving and ending a problem
officials - people who hold positions of authority and who make decisions in an organisation
stands to gain from Y - will gain money or other advantage if Y happens
reform - improvement, changes to correct a situation that is wrong or unfair การแก้ไข การปฏิรูป
X motivated by Y - Y causes X to act the way they do
personal gain - when you yourself make money (not what your employer or the public that you serve as a civil servant usually wants)
purely by - only by
justice - fairness in the way people are treated
resolving - solving and ending a problem
officials - people who hold positions of authority and who make decisions in an organisation
stands to gain from Y - will gain money or other advantage if Y happens
Economics
TAX CORNER
Getting the facts behind a customs audit
23/02/2010By Prangtip Anantavipat and Piphob Veraphong
If you need to know the consequences when you encounter a customs audit, this article will gives you a few ideas. Once a mistake arises, the customs authorities tend to accuse you of an offence under Section 27 of Customs Act B.E. 2469 (1926) with a jail term of up to 10 years. There is also a penalty of 400%, not of the deficient duties but of the entire imported value itself.
audit
- the process of checking for irregularities or things that are wrong
(See Wikipedia)
consequences - the things that happen as a result of a decision or event
encounter - to meet; to experience or deal with something, especially a problem เผชิญกับ (ปัญหา)
authorities - the people with power, the government เจ้าหน้าที่ ผู้มีอำนาจของรัฐ
tend - to be likely to behave in a particular way or have a particular characteristic มักจะ
offence - a crime or illegal activity for which there is a punishment การกระทำผิดกฎหมาย
term - a period of time
jail term - a period of time that a person found guilty of a crime must spend in jail
penalty - a punishment, or the usual punishment, for doing something that is against a law โทษ
deficient - not enough
duties - tariffs, taxes paid on imported goods
consequences - the things that happen as a result of a decision or event
encounter - to meet; to experience or deal with something, especially a problem เผชิญกับ (ปัญหา)
authorities - the people with power, the government เจ้าหน้าที่ ผู้มีอำนาจของรัฐ
tend - to be likely to behave in a particular way or have a particular characteristic มักจะ
offence - a crime or illegal activity for which there is a punishment การกระทำผิดกฎหมาย
term - a period of time
jail term - a period of time that a person found guilty of a crime must spend in jail
penalty - a punishment, or the usual punishment, for doing something that is against a law โทษ
deficient - not enough
duties - tariffs, taxes paid on imported goods
Penalties also apply in case of importation of certain goods without a licence or without carrying out proper customs formalities, or mistakenly interpreting a free trade agreement (FTA). The outcome is always considered an offence by customs officers even if the mistake is caused by negligence or misinterpretation. The 400% penalty has been used as a tool by the customs officers to convince you to settle the case in exchange for a reduced penalty to 200% of the deficient duties (rather than of the import value) and the waiver of criminal charges.
X
apply to Y, X apply in case of Y - X are used in case Y, X
are true in case Y
licence - an official document that gives someone permission to do or use something ใบอนุญาต
proper - right or correct
formalities - details you must follow if you don't want to break the law
Free Trade Agreement (FTA) - an agreement between a group of countries to eliminate many tariffs, quotas and preferences on goods passing between them (See Wikipedia)
outcome - a result ผล
officers - people in an organisation who make the decisions (who have authority)
negligence - when you do not give enough care or attention to someone or something ความประมาท, ความไม่เอาใจใส่
misinterpretation - not getting the right meaning from a document or text
convince - make people believe or do something
settle - to reach a decision or an agreement about something, or to end a disagreement แก้ปัญหา
import - to buy or bring in products from another country นำเข้า
waiver - permission not to follow a rule
criminal charges - bring a criminal case against a person, accuse someone officially of committing a crime ตั้งข้อกล่าวหา
licence - an official document that gives someone permission to do or use something ใบอนุญาต
proper - right or correct
formalities - details you must follow if you don't want to break the law
Free Trade Agreement (FTA) - an agreement between a group of countries to eliminate many tariffs, quotas and preferences on goods passing between them (See Wikipedia)
outcome - a result ผล
officers - people in an organisation who make the decisions (who have authority)
negligence - when you do not give enough care or attention to someone or something ความประมาท, ความไม่เอาใจใส่
misinterpretation - not getting the right meaning from a document or text
convince - make people believe or do something
settle - to reach a decision or an agreement about something, or to end a disagreement แก้ปัญหา
import - to buy or bring in products from another country นำเข้า
waiver - permission not to follow a rule
criminal charges - bring a criminal case against a person, accuse someone officially of committing a crime ตั้งข้อกล่าวหา
One of the known reasons for active customs audits is the reward-sharing programme. An amount equal to 30% of the penalties will be granted to people outside the Customs Department as a reward for identifying an offence. Another 25% is shared among officers participating in an arrest or investigation. Only the remaining 45% goes to the national treasury. With this incentive, any attempt to seek a waiver of customs penalties or an appeal process by an importer tends to be detrimental to the interest of people who have their shares in this reward programme.
active
- doing a lot of an activity, doing activity intensely
reward - money that someone receives for finding and returning something or for helping the police รางวัล
reward-sharing programme - a program in which many people split a reward given for achieving something
penalties - บทลงโทษ
granted - officially gave ให ้ (เงินกู้)
identifying - can name the person, know who the person is ระบุชื่อ
investigation - the process of trying to find out all the details or facts about something in order to discover who or what caused it or how it happened การตรวจสอบหาข้อเท็จจริง
treasury - the system or government department responsible for financial matters such as spending and taxation ระบบการคลัง
incentive - a reward to encourage people to act in certain ways สิ่งกระตุ้น
appeal - to request that a court decision by changed ขออุทธรณ์
process - a series of actions that you take in order to achieve a result แนวทางปฏิบัติ, กระบวน, วิธีการ
detrimental - causing loss or a disadvantage (harm, damage, hurt) to someone
detrimental to the interest of Y - causing Y to lose or suffer a disadvantage
shares - part of something that is yours, that you own
reward - money that someone receives for finding and returning something or for helping the police รางวัล
reward-sharing programme - a program in which many people split a reward given for achieving something
penalties - บทลงโทษ
granted - officially gave ให ้ (เงินกู้)
identifying - can name the person, know who the person is ระบุชื่อ
investigation - the process of trying to find out all the details or facts about something in order to discover who or what caused it or how it happened การตรวจสอบหาข้อเท็จจริง
treasury - the system or government department responsible for financial matters such as spending and taxation ระบบการคลัง
incentive - a reward to encourage people to act in certain ways สิ่งกระตุ้น
appeal - to request that a court decision by changed ขออุทธรณ์
process - a series of actions that you take in order to achieve a result แนวทางปฏิบัติ, กระบวน, วิธีการ
detrimental - causing loss or a disadvantage (harm, damage, hurt) to someone
detrimental to the interest of Y - causing Y to lose or suffer a disadvantage
shares - part of something that is yours, that you own
As a matter of law, if you can prove that you have no intention to avoid paying the duty, there is a way to waive or, if not all, to substantially reduce the customs penalties. Most companies do not want to fight against the Customs Department as they are afraid of criminal offences and cannot afford the economic impact from the 400% penalty based on the import value if they happen to lose the case. Some do not want to fight, even if they have a high chance of winning, as they are expecting a legitimate kickback of 30% of the penalties from their own organisation.
matter
- an issue, a situation or subject which is being dealt with or
considered เรื่อง, ภารกิจ, งาน, something that you are discussing,
considering or dealing with สิ่งที่พูดถึง ประเด็นที่พูดถึง
a matter of law - some issue in a legal case that is being dealt with
intention - a plan in your mind to do something ความตั้งใจ เจตนา แผนการ
waive - officially give permission to not do some required thing
substantially reduce - reduce by a large amount
afford - to have enough money to be able to pay for something มีเงินพอจับจ่าย ซื้อหา
impact - an effect or influence ผลกระทบ
chance - what happens when you don't control events (example: gambling = games of chance)
legitimate - correct according to the law ที่ถูกต้องตามกฎหมาย
kickback - an amount of money that is paid to someone illegally in exchange for secret help or work เงินสินบน, เงินใต้โต๊ะ
a matter of law - some issue in a legal case that is being dealt with
intention - a plan in your mind to do something ความตั้งใจ เจตนา แผนการ
waive - officially give permission to not do some required thing
substantially reduce - reduce by a large amount
afford - to have enough money to be able to pay for something มีเงินพอจับจ่าย ซื้อหา
impact - an effect or influence ผลกระทบ
chance - what happens when you don't control events (example: gambling = games of chance)
legitimate - correct according to the law ที่ถูกต้องตามกฎหมาย
kickback - an amount of money that is paid to someone illegally in exchange for secret help or work เงินสินบน, เงินใต้โต๊ะ
You may find it a shock to learn that, in a number of investigations, there is no way the Customs Department can have information on the operation of a business unless some insider leaks the information in exchange for rewards. Of course, the rewards would not be very attractive if the company in question decides to appeal. The law encourages settlement by reducing the penalty to 200% of the deficient duties and by waiving the criminal charge if the company agrees to settle the case. Still the reduced penalties continue to be shared at the same ratio.
insider - a person
who works in an organisation and who has access to secret information
leaks the information - make secret information within an organisation available to the public
do X in exchange for Y - do X for someone who then give you Y in return
attractive - worth having or doing
the company in question - the company involved in the case, the company referred to here
settlement - when the people involved in a legal case get together and make an agreement to end the case
settle the case - make a settlement (see above)
ratio - a percentage of the whole, the way that something is divided (10% to X, 30% to Y,....etc)
leaks the information - make secret information within an organisation available to the public
do X in exchange for Y - do X for someone who then give you Y in return
attractive - worth having or doing
the company in question - the company involved in the case, the company referred to here
settlement - when the people involved in a legal case get together and make an agreement to end the case
settle the case - make a settlement (see above)
ratio - a percentage of the whole, the way that something is divided (10% to X, 30% to Y,....etc)
It is often the case that the insider has co-operated with customs officers to hurriedly bring to case to an end by claiming that the compromise is more beneficial to the company. Unfortunately, this is no justice to shareholders or the staff of the company who get nothing from this settlement.
compromise
- give up something to reach an agreement ประนีประนอม
beneficial - helpful or good มีประโยชน์
justice - when people are treated fairly and equally (See Wikipedia) ความยุติธรรม
shareholders - those who won the stock of a company
staff - workers, employees พนักงาน
beneficial - helpful or good มีประโยชน์
justice - when people are treated fairly and equally (See Wikipedia) ความยุติธรรม
shareholders - those who won the stock of a company
staff - workers, employees พนักงาน
Keep in mind that if the company has no intention whatsoever to avoid tax, it has legal rights to protect itself from such penalties. A good example can be seen in the steel industry. While a few companies gave up, some refused to settle the cases and appealed against the demand notice for payment of the penalties. The court subsequently ruled in favour of these companies.
keep in mind that - remember
that
has no intention whatsoever to - for sure does not plan to do
rights - what the law allows you to have and do สิทธิ์ (See Wikipedia)
gave up - stop doing an activity or trying to solve a problem
notice - information or warning หมายเตือ
a demand notice - an official document sent to someone requesting that they pay money
subsequently - after that
favour - to give an advantage to someone or something, often in an unfair way ช่วยเหลือ
ruled in favour of Y - when a court of law's decision benefits or helps Y
has no intention whatsoever to - for sure does not plan to do
rights - what the law allows you to have and do สิทธิ์ (See Wikipedia)
gave up - stop doing an activity or trying to solve a problem
notice - information or warning หมายเตือ
a demand notice - an official document sent to someone requesting that they pay money
subsequently - after that
favour - to give an advantage to someone or something, often in an unfair way ช่วยเหลือ
ruled in favour of Y - when a court of law's decision benefits or helps Y
Last but not least, the customs laws allow a settlement even if you have already submitted an appeal against the demand notice. There is no rush to settle a case with the customs officers and you should try to protect the company's rights first unless you are expecting to share the rewards programme.
Last but not least,... - the
last thing I will talk about is....(and because i talk about it last
does not mean it is not important)
submitted - formally given to someone so they can make a decision about it ยื่นเอกสารเพื่อการพิจารณา
rush - to move or do something very quickly รีบเร่ง, วิ่ง
share - to have or use something at the same time as someone else ใช้ร่วมกัน
submitted - formally given to someone so they can make a decision about it ยื่นเอกสารเพื่อการพิจารณา
rush - to move or do something very quickly รีบเร่ง, วิ่ง
share - to have or use something at the same time as someone else ใช้ร่วมกัน
One good lesson from this is that an organisation should appoint people who are keen on guarding its interests when dealing with customs. At any rate, you might have heard the news that the Thai government is considering hard how to amend the customs laws. One big aspect would involve a reform of the reward-sharing programme as there are pros and cons in this regard. Let's keep an eye on developments in the future
appoint
- to choose someone officially for a job or responsibility
แต่งตั้ง,ตั้งให้เป็น
keen - very interested, eager or wanting (to do) something very much สนใจ, ใจจดใจจ่อ
interests - connections that you may benefit from, therefore affects your attitude to it and the way you deal with it
at any rate -
amend - to make changes to a document, law, agreement, etc. especially in order to improve it การแก้ไขกฎหมาย
aspect - one part of a situation, problem, subject, etc ด้าน,มุม
reform - improve, a change that is intended to correct a situation that is wrong or unfair การแก้ไข การปฏิรูป
pros - advantages
cons - disadvantages ข้อเสีย
in this regard - in this issue, in this matter
keep an eye on - watch (to see what happens)
keen - very interested, eager or wanting (to do) something very much สนใจ, ใจจดใจจ่อ
interests - connections that you may benefit from, therefore affects your attitude to it and the way you deal with it
at any rate -
amend - to make changes to a document, law, agreement, etc. especially in order to improve it การแก้ไขกฎหมาย
aspect - one part of a situation, problem, subject, etc ด้าน,มุม
reform - improve, a change that is intended to correct a situation that is wrong or unfair การแก้ไข การปฏิรูป
pros - advantages
cons - disadvantages ข้อเสีย
in this regard - in this issue, in this matter
keep an eye on - watch (to see what happens)
By Prangtip Anantavipat and Piphob Veraphong (Lawalliance Limited Company) They can be reached at admin@lawalliance.co.th
(Source: Bangkok Post, TAX CORNER, Getting the facts behind a customs audit, 23/02/2010, Prangtip Anantavipat and Piphob Veraphong, link)
