Legal Interpretation of Thai Customs Tariff: The Implications of Rule 2(a) of the General Rules for the Interpretation of the Harmonized System under the Thai Customs Law

Abstract

Tariff classification is the vital process in collecting customs duties, as it is the basis for categorizing commodities into a specific nomenclature with a relevant customs rate. The Customs Tariff Decree B.E. 2530 is an essential Thai customs regulation that specifically establishes tariff rates and general principles of interpretation for tariff categorization based on the Harmonized System: HS. As a contracting party, Thailand has implemented the system in accordance with the International Convention on the Harmonized Commodity Description and Coding System (HS Convention). According to the study, there are three major issues with how Rule 2(a) of the General Rules for the Interpretation of the Harmonized System under Thai Customs Law should be interpreted: (1) The difficulty in determining how to apply the general rules of interpretation because Thailand lacks a specific regulation outlining the sequential order of the rules; (2) The absence of a definition and clear explanation of "the essential character of the complete or finished article" results under Rule 2 (a) in disagreements between regulators and taxpayers; and (3) Thai courts have not established specific guidelines or practical norms for deferring the decisions of the HS Committee and the recommendations of the WCO related to tariff classification. This article aims to examine and analyze the abovementioned issues to develop suggestions on interpreting the law to achieve fair, clear, precise, transparent, standardize and predictable tariff procedures that adhere to the principles of good taxation and international standards.