Cuts to import duty on alcohol, cigars, part of plan to entice wealthy foreigners

A reduction in import duty on cigars and alcohol looks to be in the works, as part of a government strategy to attract wealthy foreign residents and skilled professionals. According to a Bangkok Post report, the Customs Department is expected to slash duty by 50% for a 5 year period.

The proposal is in line with the government’s plan to kick-start the decimated post-pandemic economy by attracting over 1 million wealthy foreigners to live and work in the country over the next 5 years, spending around 1 million baht per person per year and generating around 1 trillion baht for the economy. The government has devised a new 10-year visa for this purpose, which covers not just the individual, but their spouse and children too. Holders would pay the same rate of income tax as Thais and would be entitled to own property and land too.

Patchara Anuntasilpa from the Customs Department says the cut in import duty will apply to 30% of products and that his department is revising procedures for personal items belong to arriving and departing visitors.

However, the move has come as a surprise to some. The Bangkok Post reports that Roengrudee Patanavanicha, a tobacco control researcher, says the reduction in duty is unexpected, given that a new excise tax structure on cigarettes comes into effect next month, with a flat 40% rate of tax applied to all cigarettes, no matter the retail price. She says the new rate is aimed at cutting smoking among young people as well as generating tax revenue. She has refuted suggestions that putting up the cost of cigarettes leads to an increase in the illegal smuggling of contraband products.

“It is lax law enforcement, an inefficient tax system, and intervention from the tobacco industry that contribute to the problem.”

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SOURCE: Bangkok Post