Thai solar panel factories accused of being China's tax proxies

Thai solar panel factories accused of being China's tax proxies

An American solar panel manufacturer has called on the US Department of Commerce to scrutinise 14 factories in Thailand, Vietnam and Malaysia over allegations that they have been complicit in the prohibited rerouting of exports from China that would otherwise be subject to far higher US taxation.

The manufacturer of crystalline silicon photovoltaic cells in the US claimed that the factories -- four of which are in Thailand -- may simply be altering the packages of the Chinese products and exporting them onwards to the country to circumvent US anti-dumping (AD) and countervailing duty (CVD), according to a source at the Commerce Ministry.

The deliberation will take about 45 days from when the petition is submitted. If the allegations is found to have substance, the department will invoke tax circumvention rates which may see levies of up to 95.5% being placed on the products.

If the evidence is not sufficient, a public hearing will be launched ahead of court proceedings in which Thai factory owners can submit evidence of their own. The US is embroiled in a trade war against China and has implemented various tariffs -- such as AD, CVD and increased tariffs on Chinese products including solar panels.

As a result, a number of solar panel manufacturers from China have relocated their manufacturing sites to other countries in the region, including Thailand.

Of the Thai factories named in the dispute, three have Chinese investment and another is a joint venture between China and Taiwan. Two of them reportedly pay the US tariff for the AD. US import data shows solar panels exported from Thailand have been increasing since 2017, with the value of goods shipped estimated to have been US$50.41 million in 2018, $502 million in 2019, $741 million in 2020 and $604 million in 2021. However, the US also increased imports from Vietnam and Malaysia.

Keerati Rushchano, director-general of Foreign Trade Department, said staff will summon four factory owners for questioning, as well as providing advice concerning potential interviews with the US department.

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