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Import Duty To Be Cut on Alcoholic Beverages and Cigars

The Customs Department announced that it has prepared to cut import duties on cigarettes and alcoholic beverages by half for five years, following the Thai government’s economic stimulus and investment promotion package.

Patchara Anuntasilpa, the department’s director-general, said that lowering the import duty by 50% was in line with the cabinet’s September 14 resolution.

It includes plans to revive the economy in the post-Covid era, offering 10-year visitor visas and other incentives to draw high-income foreigners and highly-skilled professionals to stay and work in Thailand.

Authorities seek to attract over a million qualified people to the country over the next five years. Each foreigner is expected to spend 1 million baht on average each year while in the kingdom, generating around a trillion baht during that period.

The economic stimulus and investment promotion package comprises benefits such as a 10-year Thai visa for approved special visitors together with their relatives (spouses and children), same income tax rates as Thai citizens, right to property and land ownership, and tax exemption for income earned abroad.

According to Mr. Patchara, about 30% of the products would likely be covered by the planned cuts.

He said the government would announce the ministerial regulations after the changes are made and added that the department has already started preparing to review custom procedures over personal items for both arriving and departing passengers.

Meanwhile, a researcher on tobacco control, Roengrudee Patanavanicha, said the Customs Department’s move had caught her off guard, as the revised excise tax structure for cigarettes was set to take effect in October.

Under the new system, regulators will apply a flat tax rate of 40% to cigarettes regardless of the retail price.

Ms. Roengrudee dismissed rumors that new high cigarette prices could cause an increase in contraband cigarettes’ smuggling and stated that the new tax could help reduce teen smoking while generating revenue for the state.

“It is lax law enforcement, an inefficient tax system and intervention from the tobacco industry that contribute to the problem,” Ms. Roengrudee said.