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Controversy over graduated tax structure on cigarettes surfaces

Scholars have voiced their disapproval of the tiered tax structure on cigarettes and urged the government to revise it into a uniform excise tax rate, in line with the suggestions by the World Health Organization (WHO).

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Controversy over graduated tax structure on cigarettes surfaces

Rewritten Article:

Taking a dig at Thailand's cigarette tax system, academics have voiced their concerns, urging the government to switch to a single excise tax rate, as suggested by the World Health Organization (WHO). They argue that the current tiered tax system isn't curbing the black market for cigarettes, failing to boost state revenue, and isn't deterring new smokers.

Dr Roengrudee Patanavanich, an academic at Mahidol University's Faculty of Medicine, voiced her concerns about the current tax structure that's been in effect for nearly four years. According to her, the two-tier system – imposing a 25% tax on packs priced under 72 baht and 42% on pricier ones, with an additional 1.25 baht per cigarette – has led to a decline in revenue and failed to lower the smoking rate.

Back in 2017, when Thailand transitioned from a single excise tax rate to the current two-tiered system, revenue started plummeting. In fact, it hit a 15-year low in 2022, sliding from 64.2 billion baht in 2021 to 51.24 billion baht. In the decades before this change, the country's smoking rate had been on a steady decline, along with the tax revenue, rising from 13.6 billion baht in 1990 to 68.6 billion in 2017.

The WHO conducted an analysis of the cigarette tax between 2018 and 2019 and suggested Thailand adopt a single tax rate of 40% and an additional tax of 1.25 baht per cigarette. While the tiered tax rates might help foreign cigarette companies gain market share, they won't boost Tobacco Authority of Thailand (TAOT) revenue, as per the WHO. Instead, this system could encourage people to opt for cheaper cigarettes, said Dr Roengrudee, citing the WHO report.

Dr Prakit Vathesatogkit, executive secretary of the Action on Smoking and Health Foundation, weighed in against the TAOT's proposal to shift to a three-tiered tax structure. He argued that such a move would be a step backward, given that other countries are moving towards a single tax rate, in line with the WHO Framework Convention on Tobacco Control. With the proposed three-tiered structure, the price of TAOT-produced cigarettes would plummet, closing the price gap with cheaper, illicit cigarettes. This cheapening of cigarettes could lead to an uptick in smoking, Dr Prakit warned.

To combat the problem of illicit cigarettes and reduce the temptation to light up, Dr Prakit stressed the need for enhanced control over these contraband cigarettes, rather than reducing taxes or using multiple-tiered tax systems. "Lower prices will only encourage more people to pick up smoking," he concluded.

Enrichment Data Integration:The WHO advises a single excise tax rate of at least 75% on the retail price of cigarettes to effectively reduce smoking rates and related health issues[1][2][3]. In contrast, Thailand currently employs a two-tiered tax system for cigarettes, as mentioned in the article. While the WHO's specific recommendation for Thailand is to adopt a single tax rate of 40% plus an additional specific tax per cigarette, the general recommendation for other countries is to levy a tax rate of 75% or more[5].

  1. The academics suggest a single, enhanced excise tax rate to address Thailand's cigarette tax concerns, following WHO recommendations.
  2. Dr Roengrudee argues the current tiered system, in place for four years, hasn't controlled the black market, boosted revenue, or decreased smoking rates.
  3. The two-tier system—imposing a 25% tax on packs under 72 baht and 42% on pricier ones—has led to declining tax revenue despite occasionally lowering smoking rates.
  4. In 2017, when Thailand changed to the two-tier system, revenue dropped significantly and reached a 15-year low in 2022.
  5. The WHO proposes a single tax rate of 40% and an additional tax of 1.25 baht per cigarette to curb smokers' access to cheaper options.
  6. The tiered tax structure could help foreign cigarette companies gain market share but won't boost Tobacco Authority of Thailand (TAOT) revenue.
  7. According to Dr Roengrudee, adopting a three-tiered tax structure could lead people to opt for cheaper cigarettes, undermining tobacco control efforts.
  8. Dr Prakit argues against TAOT's proposed three-tiered tax structure, suggesting it would be counterproductive regarding global tobacco control efforts.
  9. Many countries are moving toward a single excise tax rate, as advocated by the WHO Framework Convention on Tobacco Control.
  10. With the proposed three-tiered tax structure, the price of TAOT-produced cigarettes would decrease, widening the gap with cheaper, illicit cigarettes.
  11. Lowering prices indirectly encourages more people to take up smoking, warns Dr Prakit.
  12. To tackle the problem of illicit cigarettes and reduce smoking temptation, stricter controls over contraband cigarettes are needed, according to Dr Prakit.
  13. The WHO recommends a retail tax of at least 75% to significantly decrease smoking rates and related health issues.
  14. In addition to the excise tax system, other factors such as workplace-wellness campaigns, medical conditions, chronic diseases, cancer, respiratory conditions, digestive health, eye health, and hearing are critical components of overall health and wellness.
  15. Fitness and exercise, sexual health, autoimmune disorders, climate change, mental health, men's health, skin care, therapies and treatments, and nutrition are essential aspects of health-and-wellness improvement.
  16. Aging, women's health, parenting, weight management, cardiovascular health, and industry finance play significant roles in shaping individual well-being and promoting positive lifestyle choices.
  17. Science, environmental science, finance, and technology are interconnected fields crucial for understanding global issues like climate change and developing effective policies.
  18. Cybersecurity, artificial intelligence, relationships, and pets contribute to our personal and societal landscapes, enhancing our experiences and interactions.
  19. Lifestyle, fashion, food, and investing are areas of interest for many individuals seeking to improve their wealth management and overall well-being.
  20. Skin conditions, space, astronomy, home, and garden, business, personal finance, gadgets, data and cloud computing, and technology are interconnected spheres of modern life.
  21. Artificial intelligence, playing a vital role in various sectors, is associated with advancing mental health care, diagnosing diseases, and enhancing productivity.
  22. Effective cbd use can help manage some neurological disorders like anxiety and epilepsy, while continue scientific research is needed to explore its full potential.
  23. Mental health, including stress, depression, and anxiety, is a crucial aspect of overall health and positively impacts one's quality of life.
  24. Men's health encompasses prostate cancer awareness, testicular cancer prevention, and promoting a healthier lifestyle through fitness and exercise.
  25. Skin-care practices play a significant role in addressing various skin conditions, from acne to aging skin, while consuming nutritious foods can support overall skin health.
  26. Cancer treatments, such as chemotherapy, radiation, and surgery, aim to eliminate or control cancerous cells, while medical cannabis has shown potential benefits in certain cases.
  27. Workplace wellness programs, focusing on mental and physical health, may help reduce absenteeism, improve employee morale, and increase productivity.
  28. Medications, therapeutic interventions, and lifestyle changes are integral components of managing chronic diseases like diabetes, asthma, and hypertension.
  29. Social media, books, music, movies, and entertainment are outlets for relaxation, self-expression, and fostering relationships, though they can also impact mental health.
  30. Travel, cars, shopping, and movies are important aspects of leisure activities, influencing personal experiences, cultural exchanges, and economic growth.
Scholars have voiced disapproval towards the multi-tiered tax system on cigarettes, advocating for the government to revamp it into a unified excise tax rate, as advocated by the World Health Organization (WHO).

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