NEWS
THAI GOVERNMENT MULLING TAX HIKE ON LOW & NO DRINKS
By Tony Zhu
8-6-2023
Credit: Credit: Bundo Kim/Unsplash
The Thai government is considering to increase tax on non-alcoholic alternatives on the grounds that alcoholic drinks brands are using their non-alcoholic versions to promote their parent brand, advertisement of which is banned in the Buddhist country.
Curently, low- and no-alcohol beers are taxed at 14 percent in Thailand, on a par with non-alcoholic beverages including fizzy drinks, whilst an excise tax of 22 percent is levied on the retail sales price of alcoholic beers.
The Thai Public Health Ministry is considering to increase the excise tax on non-alcoholic alternatives, as their marketing content feature the brand names, logos and images of their sister alcoholic products yet without the required health warnings.
Tim Hill, a key account director at GlobalData Singapore, said the increase in taxation on non-
alcoholic beers could “clip the wings of the niche no-alcohol beer segment even before it takes off.”
“Most stakeholders agree that non-alcohol beer has the potential to help drinkers to reduce their alcohol consumption,” he said.
“No-alcohol beer can breathe new life into the monopolistic market that suffers
from a dearth of product innovation.
“Additionally, no-alcohol beers can check the consumer shift to wines, spirits, ready-to-drink
cocktails, and hard seltzers, which are perceived as healthier indulgences.”
Low and no-alcohol beers, with alcoholic content between 0 and 0.5 percent, is a nascent segment in Thailand, accounting for just a fraction of overall beer volumes, which stood at 1.81 billion litres in 2022.
The segment’s volumes declined at a compound annual growth rate of 16.3 percent between 2017- 2022 due to the Covid-19 pandemic.
(the writer can be contacted at: info@thewinechronicle.com)
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