Thailand OKs New Tobacco Tax Structure

Thailand’s cabinet has approved a new excise tax structure for cigarettes, reports The Bangkok Post, citing a finance ministry source. The measure is expected to take effect Oct. 1.

At present, Thailand levies a 20 percent tax on the retail price for cigarette packs costing up to THB60 ($1.77). If the retail price exceeds THB60 per pack, a 40 percent tax rate is applied.

The cabinet has reportedly agreed to raise the tax rate from 20 percent to 25 percent, including the 40 percent tax rate, together with an adjustment of the retail price, which is at least THB60.

The levy in terms of volume will be raised to THB1.25 per cigarette from THB1.20, with the retail price expected to rise by THB6 to THB8 per pack.

Panuphol Rattanakanjanapatra, governor of the Tobacco Authority of Thailand, has warned that the tax hike will substantially boost the illegal cigarette trade.