The new Excise Tax Act B.E 2560 (“Act”), effective on 16 September 2017, brings together seven excise duty regulations (e.g. Tobacco Act, Liquor Act, Card Act, Excise Tax Act, Excise Tariff Act etc.) into one Act. The new Act is aimed at making tax collection more transparent and efficient. The key change in this new Act is related to the tax collection method which the Excise tax shall be collected based on a Suggested Retail Price (“SRP”) instead of the ex-factory price (for goods manufactured locally) or CIF price (for imported goods). 

 

An operator or importer has to submit the SRP application to notify the Excise Department of the SRP and its structure which shall be made on the cost of production, management cost and standard profit, excluding value added tax. Once notified, the Excise Department shall conduct the examination. In case of the retail price for end customers, the examination shall be conducted from the selling price shown on the goods, on the printing media or electronic media, on the price list or the selling price notified to a government agency or a state agency. 

 

In case of the retail price of retail shops, the selling price of goods of the retail shops shall be used and if there are several retail prices, the highest price shall be used. It shall be regarded as wrong declaration if the declared SRP is lower than 95% of the mode value of retail price (“Mode Price”) or 85% of the highest retail price of such goods which are sold in normal market in the case the Mode Price thereof cannot be determined.  The Mode Price means retail price found most in normal market from such goods which are of the same category, type, quality, and quantity in the same survey of the Excise Department, excluding value added tax. 

 

In addition, the declared SRP should be in line with market mechanism. That is it is not a price for sale promotion, for sale to privileged persons or a price under sale condition to an extent that the selling price thereof is not in line with the market mechanism. Any significant changes in the retail price may affect the declared SRP. The operator or importer is recommended to monitor the retail price and make necessary adjustment to SRP on timely basis. Under new Act, the operator or importer is required to apply for the Excise registration within 30 days prior to the first day of the manufacturing or the importation or servicing. At the same time, the operator or importer must also notify the Excise Department in writing of the regular working days and hours as well as holidays. One of the compliance requirements is to submit monthly inventory control report of imported goods to the Excise Department within 15 days of the following months. This is a newly compliance introduced which the operator or importer should be prepared.