Thailand: Tax tobacco, not just cigarettes

Tobacco Cigarettes

Thailand should slowly raise excise tax on tobacco as element of efforts to decrease the number of smoking people, due to the fact that taxes on cigarettes are not efficient, in accordance with Prakit Vathesatogkit, a popular tobacco control advocate.

He said the wrong tax structure between cigarette and tobacco was the poorest component in the country’s unsuccessful efforts to reduce smoking rates.

The low tobacco tax led to price difference between cigarettes and tobacco. Thus, whenever the government increases the tax on cigarettes, many smokers begin smoking tobacco, which is less expensive and roll their own.

The government’s latest increase in the tax on cigarettes in August led to that imported cigarettes raised in price by 9-10 baht per pack of 20, and 5-6 baht for local brands. Imported brands cost around 90 baht a pack but Thai brands vary between 37-85 baht.

The government has lifted the excise tobacco tax to one satang for every gramme of tobacco. It as well boosted the cigarette tax to 87 percent of value in addition to one baht per gramme of the cigarette.

But, the new rate is still lower than the ceiling set at 90 percent of value and three baht per a gramme per cigarette.

Dr Prakit, adviser to the Bureau of Tobacco Control under the Department of Disease Control, said that the 176 members supported the idea to establish a guideline to apply tax and price measures for tobacco control needs according to the principle that an efficient tax system will help minimize the number of smokers as well as help stop smoking initiation among young adults.

It was decided all members should increase the efficiency of tax collection on tobacco, mostly to prevent the cigarette companies intervening in tobacco tax policy.

It was also suggested that tobacco tax should be raised in accordance with the rise in people’s revenue, or inflation.

The Thai Tobacco Trade Association has, in the mean time, forced the government to change the Tobacco Control Bill drafted by the Public Health Ministry, reasoning it would have a serious influence on the estimated 482,000 retailers of tobacco countrywide.

The association’s study pointed out that 78 percent of these traders would be affected by the legislation, which could cut down their earnings by as much as 12.6 percent.

The traders suggested the bill would raise their financial burden and limit their right and freedom to do business, while at the same time there was nothing to guarantee that such new rules would help reduce tobacco use.

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