New alcohol content Thai tax proposed

[Admin]

New alcohol content Thai tax proposed 
The Nation: 25 Aug 2009
'Excise should reflect alcohol content'

Academics yesterday proposed the government adopt a new excise structure for beverages that was based on alcohol content, for the sake of social welfare.

Bunchon Songsamphant, a tax specialist at the Finance Ministry, and Pongsak Hoontrakul of Chulalongkorn University's Sasin Graduate Institute of Business Administration said the best solution would be to amend the law to levy taxes specifically based on alcohol content.

However, such a move would be difficult, because any amendment would require parliamentary approval, so they suggested the government instead use a "synthetic volume-based rate" proportional to alcohol content.

This type of measure requires only a directive from the Finance Ministry. In addition to social-welfare benefits, they said the proposed change would lead to an additional Bt30 billion in tax revenue annually.

Speaking at a seminar entitled "Alcohol, No Ordinary Commodity: Its Tax Implications for Thailand" at Chulalongkorn University, they suggested there be a single reference price for beer and different types of liquor proportional to their alcohol content for tax-collection purposes.

At present, there are three reference prices - for economy, standard and premium beers - resulting in a distortion in tax collection.

For instance, economy beer brands, which have the biggest market share, pay the least in taxes even though they have the highest alcohol content.

As a result, consumption of beer and other liquor with high alcohol content has increased rapidly in recent years, with rising social costs.

The government should also modernise its administrative system and digitise the process to track, acquit and audit foregone taxes and leakage in an effective and timely manner.

The -beverage industry is big business, generating high revenue and creating many jobs, but its products also lead to high social costs in terms of public health and safety, as well as the environment.

The government collects some Bt90 billion in taxes on beverages.

The outdated tax structure has meant Thais are lured to consume beverages with high alcohol content and cheap prices, the academics said, adding that it also distorted the market and led to unfair competition among alcohol firms.

In other words, the more the government raises the alcohol tax rate under the present structure, the more cheap alcohol is consumed, they said.

Thailand Development Research Institute president Nipon Poapongsakorn said the government should also use the excise tax system to reduce alcohol consumption and address social damage caused by such consumption.

He said the present excise structure caused many problems. The Excise Department is not able to collect taxes as targeted, because consumers turned to cheap and smuggled beverages instead.

Boonchuay Tongcharoenpulporn, director of the Thammasat Foundation and former secretary-general of the Federation on Alcohol Control of Thailand, said the Asean Free-Trade Area would also lead to more cheap imports from lower-cost countries like Laos and China.

"Many consumers have not been educated to drink responsibly, in accordance with |the law and regulations," he said, adding that many drinkers did not know how much |they could consume and still avoid |health and social problems, due to a |lack of alcohol-testing devices for individual use.

[Lourens]

It's still a bargain 

[isanbirder]

Anything which would reduce the price of wine would be good, not only for wine drinkers, but for the growing Thai wine industry.  But if you put up the price of that paint-stripper they call lao kao, it would simply encourage illegal stills (with the possibility of horrific incidents like those arising periodically in India from illicit alcohol).  At least the cheap beer is relatively (and I stress 'relatively') harmless.

[nookiebear]

I guess little will happen...........The average village Thai only has a small amount of 'dispoable income'........jacking the prices up could lead to some unwanted civil unrest.......

[3100034]

Quote from above
He said the present excise structure caused many problems. The Excise Department is not able to collect taxes as targeted, because consumers turned to cheap and smuggled beverages instead.

i find this offensive because this is in English and does not mention Thai's that is implying all foriengers are bootlegers
\

Funny all my cigarettes all have taxation  sticker on them so does any bottles of spirit and wine and Lao khoa ( good for motorcycles)   ( but i do notice there is none on bottles of beer ) They are all BOOTLEGED!!!!   big black market here we want our stickers or we could end up being prosicuted for drinking beer ...... !

[Admin]

Crtics fear Thai govt alcohol tax review 
Bangkok Post: 11 Jan 2010
Critics fear excise review will reduce alcohol price
Plan seen as benefiting premium drink makers

Opposition is mounting to a government plan to review excise taxes on alcohol.

Critics claim the planned changes will benefit liquor producers and encourage consumers to drink more.

Bundit Sornpaisal, senior researcher at the quasi-government Centre for Alcohol Studies (CAS), yesterday said the government wanted to change the way liquor excise tax was calculated.

There are presently two methods. One uses the amount of alcohol in each bottle; the other is based on the retail price of the bottle.

Dr Bundit said the calculation method which yielded the highest tax was used to tax liquor products.

Low-price spirits such as rice whisky were normally taxed on the amount of alcohol. Higher-end drinks such as beer, wine and imported spirits paid tax based on their retail price.

Dr Bundit said the plan called for higher-end liquors to be taxed based on the amount of alcohol, not price, which meant producers would pay less tax.

The Finance Ministry will forward the tax review for cabinet approval tomorrow. The ministry says the review would make the taxation fairer.

Dr Bundit said the price of alcohol could come down if liquor companies were to pay less tax, increasing alcohol consumption. "The plan to switch tax methods will serve the interests of the liquor companies," he said.

If the government is serious about discouraging people from drinking, it should impose more taxes across the board.

Rice whisky is taxed at 120 baht a litre of ethanol (known widely as "pure alcohol"). Dr Bundit believed this should be raised to 200 baht this year and 300 baht next year. If beer was to be taxed based on its alcohol content, the tax should be set at least 600 baht a litre of ethanol.

Dr Bundit said the tax change would encourage young people to drink more, as liquor would be more affordable.

www.bangkokpost.com/news/local/30805/critics-fear-excise-review-will-reduce-alcohol-price

[Lourens]

YES!!!! The first good news for 2010...Cheaper booze       

[nookiebear]

YES!!!! The first good news for 2010...Cheaper booze       

Seeing will be believing!!!!!!!!!!!!1
I haven't noticed any change whatsoever yet from the recently implemented ASEAN free trade agreement .............