Bangkok Gems & Jewellery

    The ASEAN Economic Community, or AEC, is set to begin operations in 2015. Under the teams of the AEC agreement, all the countries of Asean - the Association of South East Asian Nations - will operate as a single market. This means that for trade and trading services, the regulations of all the Asean countries will need to be adjusted to achieve some degree of commonality. It a truly open common market is to function.

    Right now, Thailand is the hub of gems and jewellery in the Asean region. It is reasonable to expect that within the Asean Economic Community. Thailand will continue to be the gem already studying the jewellery markets of the Asean countries; they are looking to substantial grownth in the jewellery business in the AEC after 2015.

    But for the Thai gems and jewellery industry tom grow and compete within the larger AEC market, Thailand's jewellery manufactureres do need, to use that well-known phrase, a level playing field. This means a favourable Thai tax regime, as it applies to the gem and jewellery industry.

    Zeo-VAT scheme on rough gemstone imports has proven a resounding success; it assures raw material supplies for the Thai gemcutting sector, and so assures Thailand's ongoing status as a world gemstone hub.

    But as well as gemstones, the jewellery manufacturing industry does depend on a number of other imports inputs: diamonds, precious metals, findings. These vital iimports currently bear import duties and other taxes, only a part of which can be sometimes claimed back in cases of finishes jewellery exports. In large part, those duties and taxes now borne by the Thai Jewellery industry, are passed on to retail customers and to the smaller export orders; this renders these Thai-made products less competitive.

    In the light of the successful Zero-VAT scheme on rough gemstone imports, Thai jewellery manufacturers are calling for similar tax cuts on other jewellery inputs. This is part of ongoing talks between the Thai Gem and Jewelry Traders Asociation, and the Ministry of Finance. And it must be said, the Ministry of Finance works hard to understand the gem and jewellery industry and its problems. The very existence of the Zero-VAT scheme on rough gemstone imports clearly attest to this.

    White Thailand is the Southeast Asian gems and jewellery hub, Bangkok is not regional hub for jewellery retail shopping. International visitors do not come to Bangkok to buy the full range of jewellery - brand-name lines, diamonds, watches. In fact, brand-name items are rarely seen in Bangkok. This is because of entering Thailand. The only jewels available in Bangkok at reasonable retail prices are Thai-made jewellery.

    To make Bangkok an international full-service jewellery shopping hub, it is necessary to greatly reduce the import duties on jewellery items coming into Thailand. This would encourage Bangkok to open up to the world-famous brand-name lines, which could then be retailed at prices comparable to Hong Kong and Singapore. The government's loss of import duty revenue could readily be made up by judicious application of other taxes on the jewellery sector, such as VAT and turnover taxes.

    With Bangkok as a true international jewellery shopping hub, the future of the Thai jewellery manufacturing industry would be assured.