The Thai Excise Department is debating whether to implement a single tax rate or a weight-based tax rate for cigarettes, reports Thaiger.

At the moment, there is a 25 per cent tax applied to cigarette packs that cost up to THB 72 (USD 2) and a 42 per cent tax applied to cigarette packs that cost more than THB 72. On top of that a flat-rate tax of THB 1.25 (USD 0.036) is applied per cigarette regardless of the price of the pack.
Ekniti Nitithanprapas, Excise Department Director-General, has now announced that the department is deliberating over whether to implement a single tax rate or a weight-based tax for cigarettes, reports Thaiger. According to Ekniti, the current system has led to cigarette producers selling packs for under THB 72 in order to avoid higher tax rates.
Should the government choose to implement a single tax rate, which will probably be between 25 and 42 per cent, it needs to factor in farmers’ incomes, public health, government revenue and the prevention of the smuggling of cheaper foreign brands, reports Thaiger.
A previous two-tier tax system saw cigarette packs costing up to THB 60 (USD 1.72) taxed at 20 per cent and those priced above at 40 percent. Following its expiration in September 2021, a 40 per cent flat rate was supposed to be introduced in October 2021, however, tobacco farmers and authorities opposed the move saying it would affect the income of both parties.
Now, the Finance Ministry, led by the Excise Department, has been tasked by the Cabinet to study the cigarette tax structure for the medium and long term to determine a fair and appropriate single-tier rate, reports Thaiger.