Packaging tax wrong

A tax on packaging in Thailand will only add to costs, industrialists say, urging the government to promote recycling and economical use of the products instead - according to a report in the Bangkok Post.

Phaphad Phodhivorakhun, the chairman of the Federation of Thai Industries, said that introducing the tax proposed by the Pollution Control Department would make industrial sectors - particularly the food industry - less competitive.

He called for the government to work with the federation to find an alternative way to protect the environment from discarded packaging.

The department had said producers of products that caused pollution should pay toward the clean-up costs. The tax would help establish the Environment Protection Fund.

The Finance Ministry has formed two committees to study the implications of the tax on the economy, society and the government's fiscal position.

Mr Phaphad said that as the department had not offered private companies an opportunity to participate in the management of the fund, some were concerned that the tax would not be used effectively to repair the environment.

''Given the economic situation, government agencies should try to boost the competitiveness of businesses, not to impose a tax that could lead to higher selling prices of products.​

''Worse still, as no member countries of Asean have introduced a packaging tax, Thailand will be at a disadvantage to countries with cheaper labour, including Vietnam and China.''​

The federation strongly supported the view that industry must play an instrumental role in environment protection and co-operate fully with other organisations toward that goal, he said.

An executive at the Pollution Control Department said the tax was not intended as merely a source of revenue. The proceeds would be distributed to companies or individual operators who recycled packaging or made environment-friendly products. Recipients would include manufacturers, scavengers and local bodies recycling waste.

An earlier Finance Ministry plan to collect excise tax on packaging waste was shelved after the industry opposed it. The department also backed that plan, in which manufacturers were to pay five baht (€0.12) for every kilogramme of foam containers produced, 4.10 baht/kg for plastic coated-paper boxes, 2.10 baht/kg for aluminium cans and 80 satang/kg for paper boxes.

Products more difficult to destroy were singled out for higher tax rates of one baht for a beer bottle and 80 satang for a plastic shopping bag with handles.

Packaging waste accounted for 40 per cent of the 13.9 million tonnes of waste generated in 2000. The state alone pays 1,000 baht to dispose of every tonne.

In a related development, Somrat Yindeepit, the director and secretary of the FTI's Environment Committee, said a new ministerial rule being drafted by the Pollution Control Department aimed at compelling industrial factories to record statistics and functional data of their pollution treatment system on a daily basis might overlap other rules.