New cigarette tax set to drive up price by 6-8 baht per pack
A new tax is expected to raise the price of a pack of cigarettes by 6-8 baht from next month.
The Excise Department has proposed the new tobacco tax structure to Finance Minister Arkhom Termpittayapaisith and expects Cabinet approval in time for the tax to be implemented on October 1, said department director-general Lavaron Sangsnit on Monday.
Since 2017, two tax rates have been imposed on cigarettes: 20 per cent for packs priced Bt60 or less, and 40 per cent for packs over Bt60. Many cigarette companies dropped their price to less than Bt60 to reduce the tax burden.
The department has not yet said whether the new structure will be a single or double rate, only that the tax will be higher.
Lavaron said the new structure aims to solve four tobacco-related problems: Reduce the burden on the public health system, minimise impacts on tobacco farmers, maintain the government revenue, and control illegally imported and counterfeit cigarettes.
An informed source said the new tax structure would drive up the retail price of cigarettes by Bt6-8 per pack.
Some retailers have reportedly been hoarding cigarettes for several months over fear of a price hike under the new tax structure.
Annual tax revenue from cigarettes is about Bt60 billion, according to the Excise Department.