Members of the Thailand Tobacco Monopoly’s (TTM) labor union rallied outside the Finance Ministry on Friday to protest about the imposition of a new excise-tax structure, according to a story in The Bangkok Post.
The workers at the state-owned TTM believe that the new excise-tax structure has caused a 41 percent drop in TTM’s cigarette sales, while providing an opportunity for foreign tobacco companies to boost their share of the market.
The rally leaders had planned to present a petition to the ministry arguing that the new tax structure and associated drop in sales could affect their jobs, and the livelihoods of tobacco farmers and those working in related businesses.
As with the previous tax structure, the new one is based in part on prices, but while the prices used as the basis for previous taxes were ex-factory or declared import prices, now they are based on suggested retail prices. The rates are 20 percent for a pack of cigarettes priced at not more than 60 baht, and 40 percent for a pack priced at more than 60 baht.
After the new rates came into effect in mid-September, importers were said to have cut the suggested retail prices of some types of imported cigarettes to 60 baht a pack to take advantage of the new rates.
The labor union foresees a sharp drop in the market share of its local cigarette brands during the next two years.
In all, 2,950 TTM employees, 1,000 temporary workers, about 20,000 tobacco farmers and more than 500,000 operators of TTM-related businesses would be hurt by the drop in the sales volume caused by the new tax structure, according to the labor union.