Increase in Thai cigarette tax leaves some fuming
Thailand ranks 50th in the world for the most expensive cigarettes and more than 50,000 die each year from illnesses related to smoking
A proposal to increase the price of cigarettes in Thailand by 1-2 baht per packet has left many fuming, with critics saying the rise in price will inject little into the Health Insurance Fund and lead to few giving up the unhealthy habit.
Thailand’s Ministry of Finance has proposed the increase in cigarette tax of 1-2 baht per pack to help boost the income of the Health Insurance Fund.
On Monday, the Ministry of Finance proposed the rise in price as a way of supporting the government health health insurance fund, which officials said will earn about three billion baht (US$92,600) per year from the increase.
However, many people disagreed with the proposal. According to officials at the Excise Department, tax collected to benefit the Health Insurance Fund should not only come from cigarettes, but also from what is known as the sin tax, which also includes alcohol.
Others argued that if the new tax on cigarettes was introduced it would impact cigarette entrepreneurs, especially the Tobacco Authority of Thailand. On Sept. 16, 2017, a cigarette tax was introduced which reduced profits from 80% to 60%. Instead of getting 7 baht profit, they now only get 1 baht per pack.
In 2017, the Tobacco Authority of Thailand made a 9 billion baht profit, but in 2018, that may drop to 1 billion baht and they could make no profit in 2019, which will also affect tobacco farmers. Officials from the Tobacco Authority of Thailand said the current tax on cigarettes was 1.20 baht per cigarette and 20% of the price of cigarettes not over 60 baht. Cigarettes selling for more than 60 baht a pack are taxed 40% of their price.
While many government departments disagree with the proposed increase in price, Doctor Prakit Vathesatogkit, the Secretary of Ash Thailand – an organization which publicizes the dangers of smoking and lobbies for more stringent legislation – agreed with the Ministry of Finance’s idea to increase the cigarette tax by 2 baht per box and use the money for the health insurance fund.
Dr Prakit says the increased price would also help reduce the number of smokers. He added that every country increases taxes on cigarettes every year. He said cigarettes should be taxed at 70% of the price.
He said that even with increases in taxes the money raised would not cover the expenses the government incurred paying for people affected by cigarettes and alcohol.
Thailand joined the WHO Framework Convention on Tobacco Control on Feb. 27, 2005. The Kingdom banned smoking in indoor public places, indoor workplaces, on public transport and outdoor areas such as facilities for exercise, public parks, amusement parks, children’s playgrounds and markets.
However, international airports and non-air conditioned facilities are allowed to provide smoking areas.
Ranking the price of cigarettes worldwide, based on the price of the popular Marlboro brand, Thailand is relatively cheap. The most expensive country is Australia at US$19.40 per pack of Marlboro, the UK is in fifth place at US$12.25 per pack, South Africa is 48th at US$4.00 per pack and Thailand is 50th at US$3.77. Cambodia is way down the rankings at US$1.20
According to NationTV, about 50,710 people die each year from smoking related illnesses and a ratio of 1:6 Thai men and 1:3 Thai women die from second-hand smoke.