Excise predicts B1.5bn from next phase of sugary drinks tax
published : 9 Sep 2019 at 14:05
writer: Wichit Chantanusornsiri
The Excise Department estimates the second phase of the tax hike on sugar-sweetened beverages, effective from Oct 1, will contribute an additional 1.5 billion baht a year to state coffers.
The sugary drink tax now generates 2 billion baht a year for the government, said deputy spokesman of the Excise Department Nattakorn Utensut.
Thailand applied the excise tax on sugary drinks from Sept 16, 2017 with a goal of lowering sugar consumption. The rates rise on a gradual basis over four phases: Sept 16, 2017 to Sept 30, 2019; Oct 1, 2019 to Sept 30, 2021; Oct 1, 2021 to Sept 30, 2023; and from Oct 1, 2023.
The Excise Department has classified sugar content in beverages into six levels based on a volume of 100 millilitres: below six grammes, 6-8g, 8-10g, 10-14g, 14-18g and more than 18g.
From Oct 1, 2019 to Sept 30, 2021, the tax was on beverages with sugar content of 10g to below 14g will be raised to 1 baht from 50 satang per the 100ml bottle. For 14g to below 18g the tax will be increased to 3 baht from 1 baht, and starting from 18g it will rise to 5 baht from 1 baht.
The tax exemption for drinks containing sugar content of below 6g will remain in place, and the levies on those with 6g to below 8g, and 8g to below 10g remain unchanged at 10 satang and 30 satang, respectively.
Mr Nattakorn believes the new excise tax rate will prompt sugary beverage manufacturers to make their products less sweet.
The number of sugary drink products that have reduced sugar has risen to 200-300 from 60-70 before the levy was introduced two years ago. Moreover, the sugar content of some fizzy drinks has been reduced to below 10g per 100ml bottle to avoid higher tax bills.