Aim: In 2007, the Thai government raised the excise taxes of brandy, blended spirits and white spirits to reduce alcohol consumption. The study objectives were to explore the consumption of illegal white spirits, and estimate the price response on total alcohol consumption at the national level, after 2007 taxation policy. Methods: Consumption behaviour of illegal white spirits was surveyed 6 months after the taxation policy in two rural communities, with and without traditional production of white spirits. The quantity of total alcohol consumption was estimated for a year after taxation using baseline consumption based on the third National Health Examination Survey, market prices surveyed by the Bureau of Trade and Economic Indices and price elasticities for the demand. Findings: After raising the alcohol taxes, the spirits prices increased within 2 months. From the community survey, illegal white spirits consumption was prevalent only in the community with a production. At the national level, estimated increase in this consumption was very small. Estimated total alcohol consumption slightly decreased when taking into account substitution effects among beverages. Conclusion: The impact on illegal white spirits consumption is not a significant issue. Raising the taxes of the distilled spirits together with their taxed substitutes should be considered for future policy option.
Bibliographical noteFunding Information:
The authors are grateful to the Center for Alcohol Studies, Thailand, who provided financial support for this study. Acknowledgement for the NHES is expressed to the Bureau of Policy and Strategy, Ministry of Public Health and the Health Systems Research Institute. Suggestion on alcohol and tax-price policy was kindly provided by Dr Bundit Sornpaisarn of Center for Alcohol Studies, Associate Professor Nipon Poapongsakorn of Thai Development Research Institute and Associate Professor Isra Sarntisart of Faculty of Economics, Chulalongkorn University. The authors thank the Excise Department, Ministry of Finance for information on alcohol sales and production, the Bureau of Trade and Economic Indices, Ministry of Commerce for data on alcohol prices and the National Statistical Office, Ministry of Information and Communication Technology for data on untaxed alcohol.
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