The new tax rates for alcohol drinks, covering beer, white whisky, rice whisky and wine, will come into force on Sept 16.
Thanakorn Kuptajit, DMHT’s corporate relations director, said the company supports the new tax scheme because the law aims to increase the efficiency of the taxation system, promote fair and equal business conduct, avoid burdensome taxes pushed onto businesses and consumers, and reduce harmful use of alcohol.
Mr Thanakorn, also president of the Thai Alcohol Beverage Business Association, said the new tax scheme contains several key points and changes meant to create fairer trade practices in the industry.
Heavier penalties on illegal alcoholic spirits and moonshine, including up to a B50,000 fine to replace the existing B5,000, will help suppress smuggled goods, he said.
All imported alcoholic drinks sold in Thailand must signify evidence of sole selling rights from original producers abroad or trademark holders.
Mr Thanakorn said the tax rate based on degree of alcohol content, rather than price, will encourage the making of quality alcoholic drinks and control high-degree spirits that can affect drinkers’ health.
He said that while the alcoholic drinks companies still don’t know the impact of the new excise tax reform on their imported liquor products, importers such as DMHT, the distributor of Johnnie Walker whisky, have made preparations.
“So far, DMHT believes the new excise tax will constitute fairness for players in the private sector and lessen the illegal alcoholic beverage issue, including fake and smuggled products,” Mr Thanakorn said.
Moreover, the new excise tax scheme could lower the harmful use of alcohol. The drafting committee of the Excise Tax Act said the lower tax rate for lesser-degree alcoholic drinks is because they have less impact on health.
The government introduced the new excise tax not just for spirits, but also for tobacco and playing cards. But the Excise Department said the restructuring will not add a burden to consumers and producers should not take advantage by increasing product prices.
Apart from the tax rejig, the cabinet earlier this month approved a draft bill enabling the government to raise the excise tax on liquor, beer and cigarettes by two percentage points, with the proceeds to support a living allowance for low-income seniors.
Based on data collected by DMHT, production of all alcohol drinks in Thailand totalled 3.088 billion litres in fiscal 2015, which ended last Sept 30. The sales portion of imported liquor fell to 1.5% of the liquor business from 2% in preceding decades.
Mr Thanakorn said that regardless of the impact from the new excise tax system, he believes that the market for imported liquor will remain flat this year because of the economic environment and consumers trading down to cheaper drinks.
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