Updated on 14th January 2020
According to the Liquor Act of 1950 and the Alcoholic Beverage Control Act of 2008, there are two types of alcoholic beverages that can be imported into Thailand: distilled spirits and un-distilled spirits. Distilled spirits are alcoholic drinks which contain over 15% alcohol such as vodka, rum, or brandy; whereas un-distilled spirits, like wine or beer, are those that consist of less than 15% alcohol.
The Excise Department of the Ministry of Finance, which monitors Thailand’s alcohol industry, requires alcohol importers to fill out the “SOR2/74” form and pay a fee for issued licenses when importing alcoholic beverages for both trade and non-trade activities.
In order to get a license to import alcoholic beverages for trade, a company needs to produce a copy of its liquor selling license, pro forma invoice, label sample, registration certificate of the company’s place of business or lease contract, and an ID card or a business registration certificate.
For non-trade licenses, a copy of the pro forma invoice, ID card or a business registration certificate, and a power of attorney will suffice. When all forms and fees are paid, it should take about 30 days to issue the license.
Importers are required to get a license issued by the Excise Department for:
- Alcohol production and possession of relevant equipment;
- Importation of more than one liter of alcohol;
- Transportation of untaxed alcohol from a factory or any place of production;
- Transportation of more than ten liters of alcohol;
- Transportation of more than one liter of alcohol (but less than ten liters) between specified territories (provinces); and
- Selling alcohol products.
Valuation System
Importation of alcohol into Thailand is very expensive for alcohol producers due to excise taxes and high tariffs set by the Thai government. In Thailand, imported goods like alcohol are levied value added tax (VAT), customs duty, excise tax, and local or municipal tax. Prior to the GATT agreement of January 2000, Thailand used a “true market value system” which is the true price for quality goods sold without any deductions and abatements. Currently, taxes on imports are calculated using the Ad Valorem rate which includes the sum of import tax, cost insurance freight (CIF) value, and other corresponding charges previously stated such as VAT. To get the correct CIF value on imported wines and alcohol, the Thai Department of Customs compares reference prices against the declared prices. If the declared price is lower, the reference price will be applied.
Tax Variations
There is currently a lack of brand awareness and knowledge about wine among the general Thai population, largely due to the price index of alcohol which makes them relatively inaccessible to the masses. Therefore, attaining a good bottle of wine is normally reserved for upper or upper-middle class Thais, tourists, and expatriates. Australian and New Zealand wines are often cheaper because of the free trade agreement enacted in 2004 which has allowed lower import taxes and tariffs on imports from these two countries. This, in turn, gives wine from Australia and New Zealand a significant advantage in in the market as they are considerably more accessible in terms of prices.
Most wines from the United States are typically more expensive than those from countries which have free trade agreements with Thailand. The duty and tax burden chart below gives a breakdown of the levies by country:
Duty and Tax Burden for Wine
| Countries | Tariff Rate | Effective Duty and Tax Burden |
| USA, France, Italy, Chile and other countries under WTO agreement | 54% | 390.46% |
| Australia | 24% | 294.92% |
| New Zealand | 18% | 275.81% |
For products from countries under a Free Trade Agreement with Thailand or the ASEAN Free Trade Agreement, a reduction or exemption of taxes may apply when importing alcohol into Thailand. Member countries of AFTA (ASEAN Free Trade Agreement) get lower rates of 0-5% if the goods are imported from a member country as part of the Common Effective Preferential Tariff scheme.
Licensed producers are required to pay all applicable taxes on alcoholic beverages produced and sold in Thailand prior to transporting the alcohol out of a factory or production facility. This is done using the excise tax rate which differs between steeped liquor and distilled liquor. Steeped liquor include beverages such as red wine and sparkling wine (made from grapes), whereas distilled liquor comprises of drinks like whiskey and brandy or ethanol used by the pharmaceutical companies.
Conclusion
It seems that alcohol importers procuring from countries that have not signed an FTA with Thailand or is not a member of the ASEAN community bear the burden of high tariffs and tax when importing into Thailand. At present, little has been done to accommodate importers outside the above-mentioned exemptions and agreements, making the importation of alcohol into Thailand difficult and expensive. It is likely that the reason the Thai government has chosen to uphold such policies towards importing alcohol into Thailand is to protect the country’s local producers on top of cultural and moral factors.
Nonetheless, opinions held by the public as well as that of policy members do change over time. With that said, Silk Legal will continue to monitor developments surrounding the government’s policies towards the importation of alcohol into Thailand.
