The cabinet has approved the new excise tax structure for cigarettes, expected to come into effect this Friday, according to a Finance Ministry source.
The source said that all details will be disclosed by the Excise Department on Thursday at 4pm, after the new tax rate is published in the Royal Gazette.
At present, a 20% tax rate is applied to the retail price for cigarette packs costing up to 60 baht.
If the retail price exceeds 60 baht per pack, a 40% tax rate is applied.
The source said that the cabinet agreed to raise the tax rate from 20% to 25% including the 40% tax rate, together with an adjustment of the retail price which is at least 60 baht.
The levy in terms of volume will be raised to 1.25 baht per cigarette from 1.20 baht, with the retail price expected to rise by 6-8 baht per pack.
Meanwhile, Panuphol Rattanakanjanapatra, governor of the Tobacco Authority of Thailand, said: "The TOAT is concerned about the illegal cigarette trade which it expects to increase substantially because of the tax rate hike."
Mr Panuphol also admitted the TOAT's production rate was affected by the previous tax adjustment.