Thailand Government Considers Imposing Moderate Tax on E-Cigarettes

According to a report by Thai News website Thairath, Teerachai Attanawanich, the Vice Minister of Finance and Chairman of the Tobacco Authority of Thailand, has stated that Thailand is currently considering imposing moderate taxation on e-cigarettes.

Reducing the issue of illegal e-cigarettes.

Terra Incognita stated that they plan to transition from the current two tax rates to a single appropriate tax rate in order to achieve a balance between health and national revenue.

This measure can also help reduce the problems of illegal imports and counterfeit e-cigarettes.

We have learned that the Tobacco Administration has already collaborated with the Ministry of Health to jointly find a solution.

Despite the ban on the distribution and production of e-cigarettes in Thailand, the market is still flooded with counterfeit e-cigarettes, which now account for a significant share of approximately 25%.

Thairachai stated that the Thai government needs to find appropriate methods to reduce the number of counterfeit e-cigarettes.

Counterfeit e-cigarettes may not meet quality standards and pose potential health risks to smokers.

He also pointed out that discussions are currently underway with imported e-cigarette companies to find a solution. He believes that legalizing e-cigarettes and establishing a reasonable taxation system can help regulate the market, while reducing health risks.

The legalization of illicit products should be considered.

Due to the current status of e-cigarettes as illegal products, it is not possible to impose taxes on them.

He stated that due to the lack of tax records, it is impossible to levy taxes. However, the usage of e-cigarettes is substantial and easily accessible. Therefore, he urges all relevant parties to promptly address the issue.

We should legalize illegal products and bring them into the legitimate tax system to generate revenue for the country, while also regulating imports and safeguarding public health. In weighing the national income against the citizens' well-being, we need to consider these factors.

According to reports, Thailand currently has a two-tier system for taxing cigarettes. Cigarettes with a retail price of 72 Thai Baht or more are subjected to a tax rate of 42%, while cigarettes with a retail price below 72 Thai Baht are taxed at 25%. However, roll-your-own cigarettes, priced at 1.25 Thai Baht per roll, are subject to a tax of 1.25 Thai Baht per roll.

Over the past 10 months, the tobacco tax revenue in the country has experienced a decline. In the fiscal year 2023, the revenue amounted to 49.748 billion Thai baht, compared to 59.784 billion Thai baht in the fiscal year 2022, and 64.760 billion Thai baht in the fiscal year 2021.