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Anyone who ever walks into a shop at a Thai airport, for example at Suvarnabhumi, will be shocked by the prices, despite the fact that these are also tax-free purchases. This has to do with the high import tariffs and the monopoly position of King Power.
The founder of these stores Vichai Srivaddhaprabha was tragically in the news recently because his helicopter crashed shortly after take-off. Vichai was a multi-millionaire and owner of Leicester City football club.
The Thai Duty-Free Shop Trade Association and the Thai Retailers Association now want the government to end this monopoly position. They also believe that the import tariff on some luxury items should be reduced. They have calculated that Thailand can earn 720 billion baht instead of the current 50 to 60 billion they now receive because King Power has the monopoly.
Both parties have written an 'open letter' to Prime Minister Prayut. They also point to the airports of Incheon (South Korea), Changi (Singapore) and Hong Kong International Airport, which have organized things much better. According to TRA chairman Woorawoot, Incheon generates six times more income than Suvarnabhumi. As for the import tariffs on luxury goods, such as cosmetics, appliances, bags and shoes, he cites Malaysia and Indonesia as an example. Those countries have lowered their tariffs, resulting in a significant increase in turnover.
Would the penny have dropped and landed well? Usually prices in Thailand are increased when sales are lagging/disappointing. Lowering the price, which can increase turnover and increase profits on balance, is something that the average entrepreneur in Thailand will have to get used to. The conclusion that the prices in the duty-free section at the airport are currently exorbitantly high is certainly a fact and that King Power's monopoly position is probably one of the reasons for this.
The trick of “tax free” should be correct: free of tax, so also import duties. But Thai products are also much more expensive there than in Thailand itself. So I walk through it at most, but I prefer to pass by. By the way: I have never seen those “duty-free” purchases cheaper at other airports than in the shop.
I also never buy in the tax-free shops at the airports.
1. It's rarely cheaper.
2. More profit for the entrepreneurs because they do not have to pay taxes on it.
3. You have to carry it extra.
Moderator: Please keep the discussion at Thailand.
Isn't it generally known that this was one of the greatest projects of Mr T, who has fled and is now addressing his pheenoi on Monday? Making friends monopoly on each other. Incidentally, there is already competition in the CITY, from the gigantic Korean Lotte group, which runs a large shop center (especially a lot of tour buses with Chinese people) along RamIX, close to Makkasan ARL. But then you have to do your shopping in advance.
No, sir legacy. King Power has been around since 1989, and already got a monopoly on Don Mueang Airport in 1995, all for Mr. Thaksin. Indeed, that government gave King Power a monopoly on Suvannaphumi and later on other airports. It's not called 'King' Power for nothing. They acquired royal status with their 'garuda' in 2009.
The contracts will be reviewed in 2020. Make a bet?