The cabinet has approved tax cuts on alcoholic beverages, with wine prices set to fall significantly, in order to boost tourism.
The steep import tariffs on wines, currently assessed at 54% and 60% of declared value, will be exempted indefinitely, officials said.
The excise tax on wine will also be reduced from 10% to 5% and on local liquor from 10% to zero to help small-scale producers, government spokesperson Chai Wacharonke told reporters.
As well, the excise tax on entertainment venues would be halved to 5% of gross revenue to help operators still feeling the after-effects of the pandemic.
The tax measures are expected to take effect shortly, once a ministerial regulation is published in the Royal Gazette, and will expire at the end of this year, said Mr Chai.
The announcement comes after authorities last month extended opening hours for entertainment venues by two hours to 4am in Bangkok and other key tourist destinations. Interior Minister Anutin Charnvirakul is considering expanding the extended hours to other locations as well.
Losses of tax revenue would be offset by additional tourist receipts, said Lavaron Sangsnit, permanent secretary of the Ministry of Finance.
Tourism is a key driver of Southeast Asia’s second-largest economy. Last year, the country reached its target of 28 million international tourists, generating 1.2 trillion baht, government data showed.
In 2024, it is targeting more than 34 million foreign arrivals, Mr Lavaron said.
In the 2023 fiscal year that ended on Sept 30 last year, the Excise Department collected 177.6 billion baht in alcohol, beer and beverage taxes. The figure included 64.17 billion baht from alcoholic beverages, 86.5 billion from beer and 26.95 billion baht from other beverages.
The current excise tax structure is divided into two tiers. If a bottle of wine is priced above 1,000 baht, the excise tax is 10%, while a zero rate applies to wine priced below 1,000 baht.
However, excise tax is also applied to the volume and degree of alcohol. All wines, regardless of price, are assessed a tax at a rate of 1,500 baht per litre for 100 degrees of alcohol content. That rate has been cut to 1,000 baht.
Local liquor also faces a separate excise tax based on volume, at 150 baht per litre for 100 degrees of alcohol content. That rate remains unchanged.
The Move Forward Party has been outspoken in its support of small-scale local brewers and distillers, saying that current tax and other regulations prevent all but a handful of giant players from competing successfully.
It has championed what it called a Progressive Liquor Bill that would remove some of the impediments in the current laws.
