J Med Assoc Thai 2022; 105 (4):304-9

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Impact on Thai Health Expenditures from not Adjusting Tobacco Tax Rates under the Ministerial Regulation under Excise Act B.E. 2560 (2017)
Pattanaprateep O , Pipattanachat V Mail, Kongsakon R

Objective: To assess the effect of not adjusting the tobacco tax rate of the Ministerial Regulation under Excise act B.E. 2560 (2017) on Thai health expenditure.

Materials and Methods: The one-year economic effect of implementing versus postponing the tobacco tax rate according to the excise act was estimated. Epidemiology and economics parameters were retrieved from the Thai population-based epidemiological surveys and the related local studies. The analysis was performed for each of four cigarette types, then aggregated and the differences were calculated as number of smokers × number of cigarettes × percent margin. Finally, the effect on health expenditures was estimated.

Results: From the simulation of the four product types, total cigarette sales for all four groups would drop if the tobacco tax rate was not postponed. In consequence, government’s health expenditures would be reduced from less burden of smoking-related diseases for 1,745 million THB per year. The company profit would be decreased by –2,175 million THB only for the local products low price, while others had more profit at 9,542, 1,791, and 9,601 million THB. From the government perspective, more tax would be collected from both excise and other tax in total of 3,769 and 1,001 million THB per year.

Conclusion: Implementing suitable tobacco tax reform will reduce the number of smokers and the burden of its related diseases. The industry would still get larger increase in profit compared to the additional tax collected by the government.

Keywords: Health expenditures; Economic effect; Tobacco tax; Excise act; FCTC

DOI: 10.35755/jmedassocthai.2022.04.13295

Received 27 December 2021 | Revised 21 February 2022 | Accepted 9 March 2022

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