Experts Urge Thailand to Scrap Tiered Cigarette Tax in Favor of Single Rate
Thailand’s current two-tiered cigarette tax system is under fire from public health experts and economists, who argue that it has failed to achieve its core objectives — reducing smoking, curbing illegal sales, and increasing state revenue.
Dr. Roengrudee Patanavanich of Mahidol University’s Faculty of Medicine emphasized that the Excise Department is reviewing proposals for a new structure that would replace the existing system, which has been in place since 2017. The World Health Organization (WHO) has long recommended a uniform excise tax rate to simplify enforcement and improve health outcomes.
Under the current policy, cigarette packs priced at 72 baht or less are taxed at 25%, while those priced higher face a 42% tax. In addition, a flat rate of 1.25 baht per cigarette — or 25 baht per 20-stick pack — is applied. Despite these measures, revenue has plummeted: from 64.2 billion baht in 2021 to just 51.24 billion baht last year — the lowest level in 15 years.
Critics argue that the shift away from a single-rate tax in 2017 reversed years of progress. Between 1990 and 2017, tax revenue had steadily risen from 13.6 billion to 68.6 billion baht, while the smoking rate dropped from 31% to 19.1%. Since the introduction of the dual-rate system, however, the smoking rate has plateaued, and illicit cigarette trade remains widespread.
The Finance Ministry has also struggled to meet its annual tax revenue target of 60 billion baht from tobacco, prompting calls for urgent reform.
Dr. Roengrudee and others believe returning to a single-rate tax could simplify enforcement, increase revenue, and better support national health goals.
