Sumet Mingmongkolmitr (Senior Partner) and Yanisa Rujirawat (Associate)
For importers, the tariff classification plays a critical role in determining the applicable customs duty rate and may also affect import requirements, restrictions, or other regulatory measures applicable to certain goods. An incorrect tariff classification may therefore have consequences beyond the correction of information in a customs declaration, potentially resulting in additional customs duty liabilities and other legal consequences.
Under the Customs Act B.E. 2560 (2017) (the “Customs Act”), an importer is required to submit an accurate customs declaration and pay the applicable customs duties before the goods are released from customs custody. Accordingly, the use of a customs broker to prepare and submit the customs declaration does not relieve the importer of its responsibilities or potential liability in relation to the accuracy of the declaration.
In practice, certain goods may possess multiple characteristics or components that could potentially lead to consideration under more than one tariff classification. Determining the correct classification therefore requires careful consideration of the actual characteristics and composition of the goods, together with the applicable rules for tariff interpretation and other relevant legal requirements. The classification should not be determined solely by reference to the product name or description stated on an invoice. The Thai Customs Department has emphasized that tariff classification should be determined based on the facts and characteristics of the goods. It has also established electronic systems through which importers may search for existing tariff classification rulings and apply for advance tariff classification rulings.
If the HS Code declared in a customs declaration is incorrect and results in customs duty being paid at a rate lower than that required by law, customs officers may assess additional customs duties. The law also provides a procedure for notifying the importer of such assessment. In addition, importers may be subject to liability under the Customs Act, even though the incorrect declaration arose from a genuine mistake or misunderstanding rather than an intentional misdeclaration.
If an importer disagrees with a customs duty assessment, it may appeal to the Appeal Committee within 30 days from the date of receipt of the duty assessment notice. For disputes specifically concerning customs tariff classification, the Thai Customs Department has specific procedures and designated authorities responsible for reviewing and determining such appeals.
Accordingly, tariff classification should not be viewed solely as a logistics or shipping matter. It is an issue that should be given appropriate attention by a company’s legal, accounting, tax, and management teams. Importers should maintain relevant technical documentation, such as product specifications, catalogs, product photographs, and information provided by the manufacturer, and should verify before importation that the declared HS Code accurately reflects the nature and characteristics of the goods and corresponds to the applicable tariff classification. Such documentation can be particularly valuable if customs officers subsequently reassess the customs duty on the basis that the goods fall under a different tariff classification from the one declared by the importer.
For goods that are technically complex or where the appropriate classification is uncertain, seeking an advance tariff classification ruling from the Thai Customs Department may be an effective way to obtain greater certainty and reduce the risk of future disputes, additional customs duty assessments, and potential legal exposure.
