The European Association for Business and Commerce (EABC) has expressed concerns over an ongoing issue related to cigarette excise taxes.
In a statement issued Friday, the association said what they see as “unfair trade” may undermine foreign business confidence in Thailand.
The Excise Department’s new regulation is similar to the reported suggestion from the Thai Tobacco Monopoly, the association said.
Any new regulation requiring that the tax base for cigarettes be the suggested retail price prevailing upon the date the new law entered into effect (September 16, 2017) would be an unnecessary market interference, contradicting the principles of good governance and a free market, said Stefan Teuchert, president of the EABC.
The European Union, one of the world’s leaders in tobacco control policy and where cigarettes are subject to a mixed system of excise taxation, the taxation system allows “freely formed prices” where retail prices of tobacco products are freely set by business.
Teuchert pointed to the principle of national treatment enshrined in the General Agreement on Tariffs and Trade (GATT), under which internal taxes or regulations shall not be applied to afford protection to the domestic production.
“We believe that the Thai Government has always abided by this commitment in designing and implementing an excise tax structure and related rules for any excisable goods to promote a level playing field in doing business in Thailand,” said Teuchert.