Thailand cigarette tax row worsens
Philip Morris, through its facility in Batangas, exports some 8 billion Cigarettes to Thailand annually. Its exports represent a third of the plant’s annual ...
The Philippines is elevating its trade dispute with Thailand before the World Trade Organization after meetings conducted before the Association of Southeast Asian Nations failed to resolve the row on higher export price for Philippine-made Cigarettes. Trade Senior Undersecretary Thomas Aquino recently told reporters at the 8th eServices Global Sourcing Conference and Exhibition that the issue is now being discussed at the country’s representative office in Geneva. He said government decided to elevate the issue before the WTO after last month’s meeting among Asean officials in Baguio City yielded no results. “There was no response from Thailand on the issue during the Asean meeting so we have decided to elevate it before the WTO,” Aquino said. The Philippines is making representations for its investor, Philip Morris Philippines Manufacturing Inc., whose exports to Thailand are being slapped higher taxes. He said everything would still go through a series of consultations before the trade row will be taken up for dispute settlement under the WTO. Aquino said that while there is a venue for the dispute to be taken up in Asean as a bilateral matter, he still hopes that both parties would settle the issue among themselves. Philip Morris, through its facility in Batangas, exports some 8 billion Cigarettes to Thailand annually. Its exports represent a third of the plant’s annual production. Company managing director Craig Nelson said the trade row is weighing down on the company’s exports business. He said the company’s exports growth depends on the resolution of the issue. The Thai government’s slapping of a higher declared export price on the company’s Cigarettes had translated to higher taxes. Due to the higher valuation, the company had been required to post bond per shipment to cover the difference in valuation until the matter is resolved. “The bond is financially burdensome since we have to pay it per shipment. We want to know what are the clear rules as in any business,” Nelson said.