Cig­a­rettes, al­co­holic drinks to cost more



NEW EX­CISE taxes have af­fected prices across in­dus­tries rang­ing from bev­er­ages to cars, with the new tax regime caus­ing higher prices for some items but lower prices for others.

The Ex­cise De­part­ment ex­pects to col­lect ad­di­tional tax rev­enue of Bt12 bil­lion from the changes.

New ex­cise taxes will cause “mod­er­ate” rises in the prices of al­co­holic bev­er­ages, sug­ary drinks and cig­a­rettes, the di­rec­tor gen­eral of the Ex­cise De­part­ment, Som­chai Pool­savasdi, said yes­ter­day. It may also cause a small rise in prices for im­ported cars and cars man­u­fac­tured in cus­toms-free zones.

Som­chai told a press con­fer­ence that the new taxes rates would be ef­fec­tive im­me­di­ately. The price of many items would not in­crease and some items would be taxed less, he said. Some pro­duc­ers might ab­sorb ris­ing costs for prod­ucts fac­ing high mar­ket com­pe­ti­tion, he said, but in any case con­sumers would not pay much more for these prod­ucts.

The new ex­cise sys­tem is based on the re­tail price, while the pre­vi­ous sys­tem was based on ex- fac­tory or CIF ( cost, in­sur­ance and freight) prices.

“The new tax sys­tem will be more trans­par­ent and just as it is based on only the sug­gested re­tail price pro­posed by man­u­fac­tur­ers,” said Som­chai.

The de­tails are as fol­low­ing: The tax per bot­tle of wine priced above Bt1,000 will be Bt110 up­wards, de­pend­ing on the price. The tax on lo­cally made wine will de­crease by Bt25 per bot­tle.

The tax on a can of beer will be Bt0.50 higher, and for bot­tles of beer it will be Bt2.66 more. For high­er­priced beer, the tax will de­crease by between Bt0.99 and Bt2.

White spirit will be taxed more by Bt0.84 to Bt3.49 per bot­tle. For other kinds of lo­cally pro­duced spirit, the ad­di­tional tax will be Bt8 per bot­tle for drinks with 28 per cent al­co­hol con­tent and Bt30 for drinks with 40 per cent al­co­hol con­tent.

The tax on other im­ported spir­its, such as John­nie Walker Red and

Blue La­bel Scotch whisky, will be a lit­tle less, from Bt3 to Bt26 de­pend­ing on al­co­hol con­tent. The vari­ance is due to a tax hike on higher al­co­hol con­tent.

“In the fu­ture, the tax will in­crease based on al­co­hol con­tent, with high lev­els of al­co­hol sub­ject to higher taxes,” said Som­chai.

For low- cost cig­a­rette brands priced at Bt60 or lower, the tax will add Bt4 to Bt15 more per pack, while higher- priced cig­a­rettes will be taxed at Bt2-10 more per pack.

“Af­ter two years, the tax rates of cig­a­rettes would be the same at 40 per cent of its price and Bt1.2 per roll,” said Som­chai.

Sug­ary drinks are also sub­ject to higher taxes.

Soft drink taxes will be Bt0.13 to Bt 0.50 per bot­tle, but sugar- free soft drinks will be taxed less by Bt0.28 to Bt0.36 per bot­tle. En­ergy drinks will be taxed more, rang­ing from Bt0.32 to Bt0.90 per can or bot­tle. Green tea will be taxed Bt1.13 to Bt2.05 more per bot­tle, and the tax on cof­fee will be Bt1.35 more per bot­tle or can.

Af­ter two years, taxes on sug­ary drinks will rise to re­flect the pro­por­tion of sugar they con­tain.

Some cars also have higher taxes.

While the over­all tax rate has not in­creased, im­ported cars and those man­u­fac­tured in the coun­try’s free- tax zone will see “a small rise”, said Som­chai. The lat­ter in­crease re­flects the switch from a tax based on CIF prices to one based on re­tail prices.

Som­chai had been lob­bied by man­u­fac­tur­ers wor­ried over price rises un­der the new tax sys­tem.

Tax rates on cars are between 20 and 40 per cent, and taxes on pickup pas­sen­ger ve­hi­cles (PPV), “space cabs” and pick­ups are between 2.5 and 40 per cent. The tax on hy­brid cars is 8 per cent, and half that if man­u­fac­tur­ers get spe­cial tax priv­i­leges from the Board of In­vest­ment (BOI).

The tax on elec­tric ve­hi­cles (EV) and fuel cells is also 8 per cent, down from 10 per cent pre­vi­ously. EVs with BOI in­vest­ment priv­i­leges will be taxed at only 2 per cent.

The Ex­cise De­part­ment fore­casts that the new ex­cise tax will in­crease its an­nual rev­enue by ad­di­tional Bt12 bil­lion, Som­chai said.

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