Thailand to provide low-cost cigarettes to the poor
Thailand isn’t normally known to be a social welfare paradise, but at least smoking should now become more affordable for the less fortunate. The state-owned Thailand Tobacco Monopoly announced on February 26 that it will start selling a new type of low-cost cigarette for “low-income smokers” who may otherwise resort to the black market or rolling their own sticks.
The move comes two weeks after the military government hiked taxes on cigarettes to discourage smoking, making cigarettes significantly more expensive. Prices for a pack of formerly cheap cigarettes popular with Thais such as Krong Thip, Falling Rain and Wonder rose almost 30 per cent, with best-selling brand local Krong Thip now costing 86 baht ($2.4) per pack, up from 67 baht previously. L&M, a popular foreign brand (made in and imported from the Philippines), went up to 87 baht from 68 baht per pack. It used to cost 55 baht just three years ago.
After the hike, Thailand is now among the countries with the highest cigarette prices in Southeast Asia, with locally produced brands in Vietnam, Cambodia, Indonesia, Myanmar or the Philippines being about 50 per cent or more cheaper. But it is still more affordable to smoke in Thailand rather than in Malaysia, where cigarette prices were hiked in November last year by 40 per cent, with some brands now costing up to 18 ringgit (153 baht, $4.26). Record holder in the region is Singapore where a pack of Marlboro sets a smoker back by S$13 (325 baht, $9.30), followed by Brunei with B$7.90 (198 baht, $5.70).
Both Thai and expats smokers complain about the hefty price rise in social media, reporting prices of over 90 baht for the above cigarette brands in shops in smaller villages to accommodate transport costs, with many saying they will resort to the black market for their cigarette supply from now on.
“Some customers turn to tobacco that they can roll up on their own, and some turn to untaxed and bootleg and illegal cigarettes,” Daonoi Suttiniphapunt, director of Thailand Tobacco Monopoly, told Matichon Online. “Because they are a third cheaper than the cigarettes on the market.”
According to Daonoi, cigarette sales fell 3 per cent after the tax rise and will lead to a drop in revenue of around one billion baht ($27.5 million) per month for the company which has about 75 per cent market share in Thailand. Around a fifth of Thailand’s 66-million population are regular smokers, and together with puffing tourists and expats, some 32 billion cigarettes are going up in smoke each year in the country.
To counter the sales drop, the only solution for the tobacco monopoly seems to be the introduction of a new brand of smaller, inexpensive cigarettes.
“The price will be about 40 baht per pack in order to target the market of low-income consumers, and help them afford cigarettes,” Daonoi said, adding that the cheap cigarettes will be slightly smaller in diameter than the regular ones.
She added that the tobacco monopoly has also earmarked a total of ten million baht as reward for customs officers who detect and confiscate smuggled cigarettes at the borders. Such a payout will range from 1,500 baht per carton to 50,000 baht for large hauls that involve at least 50 cartons which is obviously competing with the usual tea money for officers turning a blind eye to smugglers.
Some observers, however, noted that the introduction of cheaper cigarettes by a state entity to make smoking “more affordable” as a reaction to the government raising cigarette taxes in order to prevent people from smoking could be called a quite paradox policy.
They compare it to the illogicality of the alcohol sales ban in entire Thailand in stores and supermarkets from midnight until 11am and from 2pm until 5pm, the latter commonly called the “mid-afternoon prohibition.” The sales ban is easy to circumvent as one can drink in a bar or restaurant all day and at makeshift sidewalk bars or nightclubs all night. The regulation is mainly attempting to prevent Thais who cannot afford “bar prices” of beer and liquor from drinking at said times, but they just would buy it in mom-and-pop shops where booze is readily sold around the clock or buy their drinks ahead of the ban periods as they also do when alcohol sales are not allowed on some Buddhist holidays. So, the effect of the alcohol sales ban on booze consumption is actually zílch.
Thailand isn't normally known to be a social welfare paradise, but at least smoking should now become more affordable for the less fortunate. The state-owned Thailand Tobacco Monopoly announced on February 26 that it will start selling a new type of low-cost cigarette for "low-income smokers" who may otherwise resort to the black market or rolling their own sticks. The move comes two weeks after the military government hiked taxes on cigarettes to discourage smoking, making cigarettes significantly more expensive. Prices for a pack of formerly cheap cigarettes popular with Thais such as Krong Thip, Falling Rain and Wonder rose...
Thailand isn’t normally known to be a social welfare paradise, but at least smoking should now become more affordable for the less fortunate. The state-owned Thailand Tobacco Monopoly announced on February 26 that it will start selling a new type of low-cost cigarette for “low-income smokers” who may otherwise resort to the black market or rolling their own sticks.
The move comes two weeks after the military government hiked taxes on cigarettes to discourage smoking, making cigarettes significantly more expensive. Prices for a pack of formerly cheap cigarettes popular with Thais such as Krong Thip, Falling Rain and Wonder rose almost 30 per cent, with best-selling brand local Krong Thip now costing 86 baht ($2.4) per pack, up from 67 baht previously. L&M, a popular foreign brand (made in and imported from the Philippines), went up to 87 baht from 68 baht per pack. It used to cost 55 baht just three years ago.
After the hike, Thailand is now among the countries with the highest cigarette prices in Southeast Asia, with locally produced brands in Vietnam, Cambodia, Indonesia, Myanmar or the Philippines being about 50 per cent or more cheaper. But it is still more affordable to smoke in Thailand rather than in Malaysia, where cigarette prices were hiked in November last year by 40 per cent, with some brands now costing up to 18 ringgit (153 baht, $4.26). Record holder in the region is Singapore where a pack of Marlboro sets a smoker back by S$13 (325 baht, $9.30), followed by Brunei with B$7.90 (198 baht, $5.70).
Both Thai and expats smokers complain about the hefty price rise in social media, reporting prices of over 90 baht for the above cigarette brands in shops in smaller villages to accommodate transport costs, with many saying they will resort to the black market for their cigarette supply from now on.
“Some customers turn to tobacco that they can roll up on their own, and some turn to untaxed and bootleg and illegal cigarettes,” Daonoi Suttiniphapunt, director of Thailand Tobacco Monopoly, told Matichon Online. “Because they are a third cheaper than the cigarettes on the market.”
According to Daonoi, cigarette sales fell 3 per cent after the tax rise and will lead to a drop in revenue of around one billion baht ($27.5 million) per month for the company which has about 75 per cent market share in Thailand. Around a fifth of Thailand’s 66-million population are regular smokers, and together with puffing tourists and expats, some 32 billion cigarettes are going up in smoke each year in the country.
To counter the sales drop, the only solution for the tobacco monopoly seems to be the introduction of a new brand of smaller, inexpensive cigarettes.
“The price will be about 40 baht per pack in order to target the market of low-income consumers, and help them afford cigarettes,” Daonoi said, adding that the cheap cigarettes will be slightly smaller in diameter than the regular ones.
She added that the tobacco monopoly has also earmarked a total of ten million baht as reward for customs officers who detect and confiscate smuggled cigarettes at the borders. Such a payout will range from 1,500 baht per carton to 50,000 baht for large hauls that involve at least 50 cartons which is obviously competing with the usual tea money for officers turning a blind eye to smugglers.
Some observers, however, noted that the introduction of cheaper cigarettes by a state entity to make smoking “more affordable” as a reaction to the government raising cigarette taxes in order to prevent people from smoking could be called a quite paradox policy.
They compare it to the illogicality of the alcohol sales ban in entire Thailand in stores and supermarkets from midnight until 11am and from 2pm until 5pm, the latter commonly called the “mid-afternoon prohibition.” The sales ban is easy to circumvent as one can drink in a bar or restaurant all day and at makeshift sidewalk bars or nightclubs all night. The regulation is mainly attempting to prevent Thais who cannot afford “bar prices” of beer and liquor from drinking at said times, but they just would buy it in mom-and-pop shops where booze is readily sold around the clock or buy their drinks ahead of the ban periods as they also do when alcohol sales are not allowed on some Buddhist holidays. So, the effect of the alcohol sales ban on booze consumption is actually zílch.
