Thai finance ministry considers beverage tax restructure to boost tourism

[webfact]

 

A proposed restructuring of the beverage tax framework is under consideration by the Finance Ministry, as revealed by the permanent finance secretary, Lavaron Sangsnit. The restructure aims to bolster tourism and domestic spending.

 

This Friday, Lavaron plans to engage in a discussion with officials from the Customs Department and the Excise Department. The proposed measures align with Thai governmental policies aimed at boosting consumption and tourism.

 

The first measure proposed focuses on increasing domestic and tourist spending, achieved by the abolition of duty-free shops in the nation’s airport arrival areas. The objective is to encourage tourists to spend more during their stay in Thailand.

Measure two considers a reduction in beverage tax, a step taken in the hope of increasing domestic spending, reported Bangkok Post.

 

by Alex Morgan 

Picture courtesy of Bangkok Post

 

Full story: The Thaiger 2023-11-30

 

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[bob smith]

9 minutes ago, webfact said:

Measure two considers a reduction in beverage tax, a step taken in the hope of increasing domestic spending, reported Bangkok Post.

BRING THE PRICE OF BEERS, WINES & SPIRITS DOWN NOW!

 

Thanks,

Bob.

[stupidfarang]

Locals can drown their sorrows cheaper after the 10,000 handout and the cost of living goes up?

[Geoffggi]

15 minutes ago, bob smith said:

BRING THE PRICE OF BEERS, WINES & SPIRITS DOWN NOW!

 

Thanks,

Bob.

Absolutely correct Bob, the current level of tax on all forms of alcoholic beverages puts many people of drinking wines etc. lower the tax & more people would consider drinking the more expensive shorts.

[mikebell]

1 hour ago, webfact said:

Thai governmental policies aimed at boosting consumption

This should go down well with RTP and their non-campaign against driving drunk.

[Purdey]

The article doesn't specify alcoholic beverages. The photo does show soft drinks. Thus...

I doubt stimulating people to consume more sugary drinks will lead to anything but increasing costs for treating diabetes.

[expat_4_life]

20 minutes ago, Purdey said:

The article doesn't specify alcoholic beverages. The photo does show soft drinks. Thus...

I doubt stimulating people to consume more sugary drinks will lead to anything but increasing costs for treating diabetes.

 

Images of alcoholic images are illegal ... I'm going with a cola, soda water and one of the vitamin beverages ... the tea and juice beverage producers must be furious
 

Edited November 30, 2023 by expat_4_life

[loong]

3 hours ago, bob smith said:

BRING THE PRICE OF BEERS, WINES & SPIRITS DOWN NOW!

 

Thanks,

Bob.

I seriously doubt that it would lower the prices in the bars, just increase profits for the bar owners.

Maybe good for those drinking wine at home, but didn't they state that they were going to lower the tax on wine a few years back?

[Paul Henry]

Many tourists from Australia favour Bali,Cambodia and Vietnam over Thailand because of the highly over priced alcholic beverages. Especially wine. Stop protecting the beer duopoly they have made enough over the last decade.

[Mavideol]

God have mercy!!!.....  this is completely sheer desperation, 1st to boost tourist they decided the solution was allow visa free people from specific countries,  then they decided to open the bars until 4 am, it appears there was not enough tourism boost thus let's raise taxes on the drinks, next week they will come up with some other non sense  555

[Jingthing]

While they're at it -- how about keeping weed legal?

[hotchilli]

4 hours ago, webfact said:

Measure two considers a reduction in beverage tax, a step taken in the hope of increasing domestic spending

Reduce beverage tax all you want, but the bars will still  charge what they want.

[2baht]

4 hours ago, Geoffggi said:

Absolutely correct Bob, the current level of tax on all forms of alcoholic beverages puts many people of drinking wines etc. lower the tax & more people would consider drinking the more expensive shorts.

Give us a hint, what expensive shorts would you consider drinking???

[khunPer]

5 hours ago, webfact said:

The first measure proposed focuses on increasing domestic and tourist spending, achieved by the abolition of duty-free shops in the nation’s airport arrival areas. The objective is to encourage tourists to spend more during their stay in Thailand.

Perhaps a more duty free price in the airport should be first attempt to increase sales. The products there are way overpriced; for example the so-called duty free Thai booze is way cheaper in a domestic 7-Eleven shop...

However, it's not only in Thailand, but rather a general issue that duty free airport shops are overpriced. In my Scandinavian home country the rule for the duty free airport shops is that their price shall not be higher than in the domestic high street shops...

[ukrules]

47 minutes ago, 2baht said:

Give us a hint, what expensive shorts would you consider drinking???

 

I'm quite partial to a glass or two of cognac these days, either Remy Martin or Martell VSOP, the XO is ok as well but it's 3 times more expensive than the VSOP and only slightly different so I stick to the VSOP these days.

 

Martell VSOP just over 3000 Baht a bottle

Martell XO 9000 Baht a bottle

 

The pricing is a complete rip off and it's less than half that price in the UK which also doesn't have low excise duty rates but these prices are insane.

 

[2baht]

4 minutes ago, ukrules said:

 

I'm quite partial to a glass or two of cognac these days, either Remy Martin or Martell VSOP, the XO is ok as well but it's 3 times more expensive than the VSOP and only slightly different so I stick to the VSOP these days.

 

Martell VSOP just over 3000 Baht a bottle

Martell XO 9000 Baht a bottle

 

The pricing is a complete rip off and it's less than half that price in the UK which also doesn't have low excise duty rates but these prices are insane.

 

I'm pretty partial to green tea, myself! 😏

[ChipButty]

I like the odd bottle of Champagne it's more than double here in Thailand than in the UK, last Saturday we went out for a bite to eat and a couple of beers I had 2 pints of Hoegaarden at 300 baht a pint most places around here are charging about 360 baht, so how much tax is on that? 

[spidermike007]

They say they want rich tourists. What sacrifices are the ministers willing to make, to get them? Rich tourists like to spend money when they travel. And they cannot do that here, as they do not like getting taken for a ride. Most wealthy people are smart with their money. Thailand could be making a fortune on a 25% luxury tax. Instead of the 100% or more, which discourages most people from buying. How many people do you see in the luxury stores here? They are almost always completely empty. Inane. Beyond inane. The lack of access to fine wine at fair prices (whether you drink fine wine or not, it is part of the lifestyle for most wealthy people), grossly exorbitant luxury taxes (every wealthy person I know loves to shop for luxury goods while on vacation, especially the wives!). I could go on.

Some regressive nimwits do not understand basic economics. By reducing taxes you stimulate the economy. In addition, if Thailand reduces its punitive wine taxes and luxury taxes, they might be able to attract more of those rich tourists they keep droning on and on and on about. The rich are smart with their money. And not only do they enjoy a nice bottle of wine with dinner, their wives also love to spend alot of money on luxury goods while they vacation. Impossible here. Who would buy a Prada handbag for $11,700 here, when you can get it for $4,800 in most world capitals? Same goes for wine. Who would spend $700 for a bottle of wine they could get for $125 at home.

It is referred to as self sabotage, or idiotic policy. An extreme lack of creativity forces retrograde politicians to become overly dependent on import taxes. Dumb and dumber. I was with a group of friends, some time ago, and we wanted to order a bottle of wine, at of one of those high end restaurants in the LeQuartier complex. It was Bella Rocca Restaurant. I asked about a 2011 Chianti they had on the list. I was told they were out of stock. I asked about a Barbaresco, at 2,600 baht. Again, out of stock. How about this Nebbiolo? Do you have the 2010, as stated on the list? No, we only have the 2015. OK, what is that wine like? Is it drinking well now? I do not know. Is there anyone here that is familiar with this wine list? No. Sorry sir. Wait a minute. You have 100 bottles on this list, ranging from 1200 baht to 10,000 baht per bottle, and NOBODY who works here knows anything about the wine? Are you serious? We all just looked at each other, and got up and walked out. We realized the restaurant was a pretender. And more than likely the food was marginal at best. It was all dressed up to look like a very nice Italian restaurant. But, it appeared to be only window dressing. High end tourists have little patience for that lack of quality and lack of service.

[nong38]

The price of wine here is way to high and I cannot understand that in relation to spirits. The wine also available is of generally very poor quality, too sweet and stuffed with local fruit to degrade it even more. On a recent trip to the UK I could buy a bottle of wine that knocks Berri Estates offerings into a cocked hat for the equivalent of 242 bts. A fair quality bottle of wine say from South Africa or Chile in Waitrose can be had for 350 bts. A bottle of Bells is cheaper here than in the UK!

[ChipButty]

5 minutes ago, spidermike007 said:

They say they want rich tourists. What sacrifices are the ministers willing to make, to get them? Rich tourists like to spend money when they travel. And they cannot do that here, as they do not like getting taken for a ride. Most wealthy people are smart with their money. Thailand could be making a fortune on a 25% luxury tax. Instead of the 100% or more, which discourages most people from buying. How many people do you see in the luxury stores here? They are almost always completely empty. Inane. Beyond inane. The lack of access to fine wine at fair prices (whether you drink fine wine or not, it is part of the lifestyle for most wealthy people), grossly exorbitant luxury taxes (every wealthy person I know loves to shop for luxury goods while on vacation, especially the wives!). I could go on.

Some regressive nimwits do not understand basic economics. By reducing taxes you stimulate the economy. In addition, if Thailand reduces its punitive wine taxes and luxury taxes, they might be able to attract more of those rich tourists they keep droning on and on and on about. The rich are smart with their money. And not only do they enjoy a nice bottle of wine with dinner, their wives also love to spend alot of money on luxury goods while they vacation. Impossible here. Who would buy a Prada handbag for $11,700 here, when you can get it for $4,800 in most world capitals? Same goes for wine. Who would spend $700 for a bottle of wine they could get for $125 at home.

It is referred to as self sabotage, or idiotic policy. An extreme lack of creativity forces retrograde politicians to become overly dependent on import taxes. Dumb and dumber. I was with a group of friends, some time ago, and we wanted to order a bottle of wine, at of one of those high end restaurants in the LeQuartier complex. It was Bella Rocca Restaurant. I asked about a 2011 Chianti they had on the list. I was told they were out of stock. I asked about a Barbaresco, at 2,600 baht. Again, out of stock. How about this Nebbiolo? Do you have the 2010, as stated on the list? No, we only have the 2015. OK, what is that wine like? Is it drinking well now? I do not know. Is there anyone here that is familiar with this wine list? No. Sorry sir. Wait a minute. You have 100 bottles on this list, ranging from 1200 baht to 10,000 baht per bottle, and NOBODY who works here knows anything about the wine? Are you serious? We all just looked at each other, and got up and walked out. We realized the restaurant was a pretender. And more than likely the food was marginal at best. It was all dressed up to look like a very nice Italian restaurant. But, it appeared to be only window dressing. High end tourists have little patience for that lack of quality and lack of service.

A mate of mine went into a Italian restaurant with his wife here in Phuket, he ordered a bottle of red wine, the girl came back and just plonk it on the table and walked away, Hey are you going to open that he said to her, 555

[Mike Lister]

5 minutes ago, nong38 said:

The price of wine here is way to high and I cannot understand that in relation to spirits. The wine also available is of generally very poor quality, too sweet and stuffed with local fruit to degrade it even more. On a recent trip to the UK I could buy a bottle of wine that knocks Berri Estates offerings into a cocked hat for the equivalent of 242 bts. A fair quality bottle of wine say from South Africa or Chile in Waitrose can be had for 350 bts. A bottle of Bells is cheaper here than in the UK!

The Thai wine industry is worth almost USD 1 billion per year, the high price on imports is to protect the home market.

 

https://www.statista.com/outlook/cmo/alcoholic-drinks/wine/thailand#revenue

[spidermike007]

1 minute ago, ChipButty said:

A mate of mine went into a Italian restaurant with his wife here in Phuket, he ordered a bottle of red wine, the girl came back and just plonk it on the table and walked away, Hey are you going to open that he said to her, 555

 

Such exemplary service is the reason why wealthy tourists are flocking to Thailand. They cannot get enough of the place, and the wives love shopping at overpriced luxury boutiques!

[spidermike007]

Just now, Mike Lister said:

The Thai wine industry is worth almost USD 1 billion per year, the high price on imports is to protect the home market.

 

https://www.statista.com/outlook/cmo/alcoholic-drinks/wine/thailand#revenue

 

Utterly ridiculous tripe. The wine import market would be ten times the size it currently is, with a 70% tax, instead of 300%. And that would mean many billions in taxes. The only reason the domestic market is protected is bought and paid for officials and politicians, and the extreme lack of wisdom inherent within this policy is a national tragedy. Also, an abundance of fine wine at fair prices would attract more wealthy tourists, wine events and festivals, etc. Thai wine is a highly inferior product. It does not deserve any protection.

[Mike Lister]

1 minute ago, spidermike007 said:

 

Utterly ridiculous tripe. The wine import market would be ten times the size it currently is, with a 70% tax, instead of 300%. And that would mean many billions in taxes. The only reason the domestic market is protected is bought and paid for officials and politicians, and the extreme lack of wisdom inherent within this policy is a national tragedy. Also, an abundance of fine wine at fair prices would attract more wealthy tourists, wine events and festivals, etc. Thai wine is a highly inferior product. It does not deserve any protection.

It may well be tripe but it's still true and correct! The government is protecting it's home market, which is what they do on some many different fronts. This is why the quality of so many things here is ultra poor.

[spidermike007]

Why is wine tax in Thailand 250% on average? In most cases, duties constitute a State’s first protection against products imported from other countries in direct competition with local production.

Does Thailand produce wine? Yes, local production is around one million liters per year and is based in 3 areas of the country: Loei, Hua Hin and Khao Yai. The projects are relatively recent, and the quality of the wine produced is rather low with a high price.

 

Therefore, taxes on wine imports into Thailand would not appear to be a protectionist measure: against a production of one million liters, import weighs for 18.5 million liters per year, for a market worth 4 billion THB before customs, therefore estimated at (at least) 20 billion turnover on the retail market (source: Thai Custom, December 2022).

 

https://www.lexology.com/library/detail.aspx?g=e5332250-7d7e-4274-8aaf-5fac06ce95f2

[Mike Lister]

8 minutes ago, spidermike007 said:

Why is wine tax in Thailand 250% on average? In most cases, duties constitute a State’s first protection against products imported from other countries in direct competition with local production.

Does Thailand produce wine? Yes, local production is around one million liters per year and is based in 3 areas of the country: Loei, Hua Hin and Khao Yai. The projects are relatively recent, and the quality of the wine produced is rather low with a high price.

 

Therefore, taxes on wine imports into Thailand would not appear to be a protectionist measure: against a production of one million liters, import weighs for 18.5 million liters per year, for a market worth 4 billion THB before customs, therefore estimated at (at least) 20 billion turnover on the retail market (source: Thai Custom, December 2022).

 

https://www.lexology.com/library/detail.aspx?g=e5332250-7d7e-4274-8aaf-5fac06ce95f2

Yes, all that may be true but you clearly haven't thought it through from a Thai perspective. Indeed, the government could make more in tax revenue if it didn't support the home market but that would mean the home market producers wouldn't survive and the country would become reliant on wine imports. So, that would mean a loss of independence, local producers would go out of business plus imports would be higher each month and this would mean more reliance on goods exports to protect the balance of trade and the value of THB.

[Etaoin Shrdlu]

Thailand has long been practicing a form of Neo-mercantilism that depresses wages, allocates capital and labor to export industries and suppresses consumption by means of excise and sumptuary taxes.

 

This change will reduce government tax receipts and put further pressure other tax revenue streams such as corporate and personal income tax. I would prefer to drink wine less frequently, buy fewer luxury goods, and not have my income taxed aggressively.

[Mike Lister]

1 minute ago, Etaoin Shrdlu said:

Thailand has long been practicing a form of Neo-mercantilism that depresses wages, allocates capital and labor to export industries and suppresses consumption by means of excise and sumptuary taxes.

 

This change will reduce government tax receipts and put further pressure other tax revenue streams such as corporate and personal income tax. I would prefer to drink wine less frequently, buy fewer luxury goods, and not have my income taxed aggressively.

Agreed. But Thailand and its budget relies on indirect taxation rather than income tax which is only 2% of the tax take. Everyone pays indirect taxes such as VAT and sales tax plus it gives the appearance that the poor escape taxation completely.

[scottiejohn]

16 minutes ago, Mike Lister said:

The Thai wine industry is worth almost USD 1 billion per year, the high price on imports is to protect the home market.

 

https://www.statista.com/outlook/cmo/alcoholic-drinks/wine/thailand#revenue

Would any expat or tourist drink the local rubbish wine?

It is not worth "protecting"!

That is like saying put a 250% tax on all spirits to protect SangSom!

[Mike Lister]

Just now, scottiejohn said:

Would any expat or tourist drink the local rubbish wine?

It is not worth "protecting"!

That is like saying put a 250% tax on all spirits to protect SangSom!

I'm not suggesting it's the right thing to do or that the wine is any good, I'm merely explaining why the import tax is so high.