BANGKOK, Thailand – The Excise Department has proposed a move to a single-rate cigarette tax system as it seeks to address declining tobacco tax revenue and growing concerns over illegal cigarette sales. Excise Department Director-General Pornchai Teeravej told the Budget Committee for fiscal year 2027 that Thailand currently applies a two-tier cigarette tax structure, with a 25% tax rate for cigarettes priced at no more than 72 baht per pack and a 42% rate for cigarettes priced above 72 baht per pack.
He said the system has contributed to a decline in cigarette tax revenue of around 10–20 billion baht annually, as consumers have shifted toward lower-tax cigarettes. The department has completed a study on introducing a single-rate cigarette tax system and is now gathering opinions from academics before submitting the proposal to the Ministry of Finance for further consideration. Pornchai said the new structure aims to create a fairer system benefiting the tobacco industry, tobacco farmers and government revenue collection. The timing of implementation will depend on the outcome of consultations and government approval.
The Excise Department is also continuing efforts to suppress illegal cigarettes and electronic cigarettes by working with the Customs Department and other agencies to inspect border smuggling routes, suspected storage facilities and illegal tobacco distribution networks. From June 2025 to June 2026, authorities seized approximately 30,000 cases related to illegal goods, representing a 30–40% increase from the previous year, which the department said reflects improved enforcement efficiency. The proposed reform follows an announcement in February 2026 that the department was preparing to submit a single-rate cigarette tax structure for Cabinet approval. The planned system would adjust both quantity-based and value-based taxation from the current structure, which includes a tax of 1.25 baht per cigarette stick.
