Excise Department: New Draft Announcement Outlines Criteria, Methods and Conditions for Tax Exemptions or Refunds for Exported Goods, Deposited Goods in Free Zones and Goods Eligible for Tax Exemption and Refund

Background and Objectives

The Excise Department has identified several issues related to the current criteria, methods, and conditions for excise tax exemptions and refunds as outlined in five existing announcements. These issues create difficulties for both the public and the excise authority in complying with regulations.

Additionally, these announcements do not address all aspects of excise tax exemptions or refunds comprehensively.

To address these challenges, the Excise Department has consolidated the five existing announcements into a single draft announcement, titled “Draft Announcement Outlines Criteria, Methods, and Conditions for Tax Exemptions or Refunds for Exported Goods, Deposited Goods in Free Zones, and Goods Eligible for Tax Exemption and Refund” (“Draft Announcement”). This new draft aims to simplify compliance, ensure accuracy, and enhance the efficiency of tax exemption and refund processes.

Key Issues Addressed in the Draft Announcement

1. Consolidation of Existing Announcements: The Draft Announcement revokes five previous announcements and combines them into one comprehensive document. This consolidation covers eligible goods for tax exemptions or refunds, individuals eligible for applications, submission procedures, and duties of excise authorities. This aims to simplify the process for both the public and excise authority.
2. Electronic Seal for Oil Transportation: The Draft Announcement introduces the use of electronic seal devices (E-Seal) for the control and monitoring of the transportation of diesel and gasoline oil products exported outside the Kingdom or transported to or from a free zone by land. This replaces the previous method of using excise stamps for monitoring.
3. Transportation via Pipeline: New provisions for the transportation of oil and petroleum products via pipeline from one storage location to another have been added. This includes responsibilities for notifying exports, receipts, and submitting reports to local excise offices, as well as inspection duties of excise authorities at both origin and destination points. The timeline for shipping goods has also been adjusted.
4. Cancellation of Storage Locations: The Draft Announcement provides guidelines for notifying the cancellation of a storage location awaiting export. It includes scenarios for locations with no goods and those with remaining goods that need to be transferred. Responsibilities for notifying exports, receipts, and report submissions to local excise offices, as well as inspection duties, are detailed.
5. Deadline for Tax Refund Requests: The Draft Announcement specifies the deadline for submitting requests for tax refunds or exemptions for goods eligible under Sections 107 (1), (2), (3), and (4) of the Excise Act B.E.2560 (2017). Requests must be submitted before importation or exportation of goods. New submission channels include customs offices, customs checkpoints, local excise offices, or the Excise Department’s website.
6. Amendment of Annex Forms: The annex forms have been updated to align with the Draft Announcement. These forms include:
   1. Excise tax exemption or refund request form under Section 103 of the Excise Tax Act B.E. 2560 (2017) (PhorSor.05-01).
   2. Excise tax exemption or refund request form for goods in the category of consumption powder other than milk powder under Section 103 of the Excise Tax Act B.E. 2560 (PhorSor.05-01(Kor)).
   3. Excise tax exemption request form for goods exported outside the Kingdom or imported into a duty-free zone for storage awaiting export (PhorSor.05-01/1(Kor)).
   4. Notification form for the receipt and distribution of goods granted tax exemptions at storage locations under Sections 103 and 107(4) of the Excise Tax Act B.E. 2560 (2017) (PhorSor.05-01/2).

Conclusion

The Draft Announcement aims to resolve compliance difficulties and address gaps in existing regulations. Key updates include the use of electronic seals for oil transportation, procedures for pipeline transport, notification of storage location cancellations, deadlines for tax refund requests, and updated annex forms. The first public hearing period closed on 29 November 2024. The Draft Announcement is under review, and amendments may be made based on public feedback, with another round of hearings expected before final issuance.

Key Takeaways

• The Draft Announcement consolidates five previous announcements into one.
• It introduces electronic seals for oil transportation and procedures for pipeline transport.
• New guidelines are provided for canceling storage locations and specifying deadlines for tax refund requests.
• Updated annex forms align with the new provisions.
• Stakeholders should follow the progress to prepare for the Draft Announcement’s finalization and enforcement.

The Excise Department invites feedback from relevant stakeholders, including business operators and government officials, to ensure the Draft Announcement meets the needs of all parties involved.

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