mactbkk
Senior Member
- Joined
- Mar 31, 2011
- Location
- Rangsit-Nakhon Nayok, Klong 10
- 22 Feb 2016
- Bangkok Post
- Contact Crime Track: crimetrack@bangkokpost.co.th
[h=2]Police launch ‘grey market’ suppression drive, writes Wassayos Ngamkham[/h]High taxes cause these companies to find every possible way to pay as little tax as possible.
POL COL NARONGDET KAMOLBUT SUPERINTENDENT OF THE ECONOMIC CRIME SUPPRESSION DIVISION’S SUB-DIVISION 2
Large bikes such as Harley Davidsons and choppers have become increasingly popular in Thailand, but they are expensive because of the huge tax pinned on them. This has given rise to a “grey market”, where shady operations take root to find ways to evade taxes and deliver cheaper bikes to buyers.
Concerned about rapid growth in the so-called grey market, police have launched a suppression drive, starting with the raid of a big bike shop in Chon Buri last Friday.
The Economic Crime Suppression Division is leading the campaign to crack down on tax dodges concerning big bikes.
Sellers, both Thai and foreign operators, are known to avoid paying proper taxes to sell motorcycles at inexpensive prices.
Pol Lt Gen Thitirat Nongharnpitak, the Central Investigation Bureau commissioner, said the campaign is not an ordinary crackdown on crime. He considers it a fight against the kind of illegal activities that will hurt the economy in the long run.
The raid on the big bike shop on Friday was part of a large operation involving 500 police who were ordered last week to inspect similar shops in tourist areas in Pattaya in the east, Phuket in the south and Chiang Mai in the north.
No one was nabbed in the Friday raid as the shop owners got wind of the raid. They closed up shop and did not stick around to meet the officers when they came knocking at the door.
The grey market is currently popular among people looking to buy choppers, said Pol Col Narongdet Kamolbut, who led the Friday raid.
But the satisfaction of buying a cheaper bike comes at the cost of the country’s tax revenue, he said.
Pol Col Narongdet, superintendent of the Economic Crime Suppression Division’s sub-division 2, also sees its long-term impact. He and his subordinates are taking different measures to curb such crime.
The team will continue their efforts to bring sellers to justice while at the same time warning buyers against supporting this illegal business.
Pol Col Narongdet began a follow-up investigation into the shop in Chon Buri. His team is looking for its owners to examine their import and tax documents and check who buys motorcycles from them.
If transgressions are found, the sellers will face legal action while the buyers will need to pay taxes.
According to the investigation, high taxes are the driving force of this business.
“High taxes cause these companies to find every possible way to pay as little tax as possible,” said Pol Col Narongdet. “But the government loses several millions of baht a year in revenue as a result.”
The sellers, some of whom form companies in which foreigners and Thai nationals co-invest, have used two methods to avoid paying high taxes, he said.
Importers of motorcycles can forge documents that state prices lower than the actual value of the vehicles or import new bikes disguised as second-hand vehicles.
In their view, it is worth taking the risk because following the lawful procedure to import the bikes will cost them between 200-300% more in taxes.
They can use this trick to fool authorities and exploit legal loopholes, Pol Col Narongdet said, adding it is the state agencies’ duty to identify and plug loopholes.
The other method these grey marketeers use is to import parts of motorcycles and assemble them locally without permission. This allows them to pay taxes on “spare parts” at much cheaper rates.
They then forge documents to register the assembled motorcycles with the Department of Land Transport.
Pol Col Narongdet called this “laundering vehicle parts”.
From the buyers’ perspective, cheap prices are the main reason they turned to the grey market despite it being illegal.
Buyers are also impressed with the faster delivery because sellers are not required to spend a lot of time preparing documents to correctly import the vehicles into Thailand.
The third reason is, the grey market often offers big bikes with more options than those sold by authentic suppliers.
He said he understands how big bike lovers feel when they see motorcycles that suit their passion and personalities, but if these motorcycles are not taxed legally, buyers will have their vehicles seized and face legal action.
