Significant Changes in Policies in Wine Taxation in Thailand

Breaking News: Significant Changes in Policies in Wine Taxation in Thailand to Boost Tourism and Economic Growth

In a landmark decision, the Thai Cabinet has approved a set of measures aimed at promoting Thailand as a premier tourist destination and enhancing the local economy. The focus is on transforming the country into a hub for high-quality dining experiences, with an emphasis on affordable pricing. The key changes include a revision of the wine tax structure, exemptions for selected items, and an overall reduction in excise duties.

Effective from January 2, 2567, the new measures are expected to have a substantial impact on both domestic and international tourism, contributing to an estimated annual revenue increase of 2.9 billion Baht. Additionally, it is anticipated to bolster the GDP by 0.0073% annually.

Key Changes in Wine Taxation in Thailand:

Unified Tax Rates for Wine Categories:
- Wine and sparkling wine made from grapes will now be taxed at a unified rate of 5% based on the value and 1,000 Baht per liter of pure alcohol. This measure includes all kind of wines imported from Europe and USA and cancel the previouse tax scheme (read HERE)
- Fruit wines incorporating grapes will see a unified rate of 0%, with no tax based on value and 900 Baht per liter for alcohol content.This measure includes mainly the Korean Sojou.
Segmented Tax Rates for Other Liquors:
- Various liquors will be categorized into subtypes with specific tax rates:
  - Traditional Thai spirits like “U Khao,” “Sa To,” and local fruit-based spirits with alcohol content up to 7 degrees will be taxed at 0% based on value and 150 Baht per liter of pure alcohol.
  - Spirits blending local and distilled alcohol with over 7 degrees of alcohol, such as Soju, will be taxed at 10% based on value and 255 Baht per liter.
Tax Exemptions for Non-Commercial Liquors:
- Non-commercial liquors not intended for trade will now align with the adjusted tax structure, maintaining a 0% tax rate based on value and equaling the tax rate of commercial spirits.

DUTY EXEMPTION FOR ALL WINES

The Ministry of Finance, through the Customs Department, is drafting a ministerial announcement on the reduction and exemption of customs duties in accordance with Section 12 of the Customs Tariff Act B.E. 2530 to amend the structure of customs duties on wine products to align with the adjustment of excise tax structures. The proposal includes exempting customs duties on all types of wine under tariff codes 22.04 (wine made from fresh grapes and grape must) and 22.05 (vermouth and other wines made from fresh grapes, flavored with plant extracts or aromatic substances), totaling 21 subcategories. The customs duty rate will be reduced from 60 percent to complete exemption.

Implementation Period – The regulation will take effect concurrently with the draft ministerial decree as per Section 1.1.

DUTY EXEMPTION AND EXCISE REDUCTION ON ITALIAN WINES WILL BE EFFECTIVE SOON

The changes in Wine Taxation in Thailand aim to stimulate spending on food and beverages, particularly within the tourism sector, by offering attractive pricing options. This move supports the broader strategy to position Thailand as a hub for quality dining experiences, encouraging both local and international tourists to contribute significantly to the country’s economy.

The Ministry of Finance expects these changes to be implemented shortly after the official announcement in the Royal Gazette, marking a new era for Thailand’s wine and liquor industry and setting the stage for increased tourism and economic growth.

Source: Thaipublica.org

Latest update (22 Februray 2024) here: https://www.siamdevelopment.com/duty-exemption-on-wine-in-thailand-effective-from-today/

Read here on Excise reduction effective from February 22nd, 2024: https://www.siamdevelopment.com/how-much-is-excise-tax-on-wine-in-thailand/