• Alcohol;
  • alcohol-related harm;
  • low- and middle-income countries;
  • taxation;
  • 2C1;
  • Thailand

According to Jürgen Rehm and his colleagues, the alcohol taxation approach introduced in Thailand in the Alcohol Act 1950, the so-called two-chosen-one (2C1) taxation, aims specifically to prevent drinking initiation in addition to reducing alcohol-attributable harms. The 2C1 taxation is a system where the actual tax rate for a certain alcoholic beverage is that which is the higher one when taxes are calculated according to two alternatives, on one hand as a specific tax which is a function of the alcohol content of the beverage and, on the other hand, as an ad valorem tax, which is a function of the price of the beverage. Rehm and his colleagues conclude that ‘2C1 taxation has the potential to simultaneously reduce alcohol consumption and prevent drinking initiation among youth . . .’[1]. This potential impact—they do not claim that it is a real impact—is the result of the unique properties of the 2C1.

The 2C1 taxation is said to put higher tax on beverages which are preferred by heavy drinkers as well as on those beverages which are preferred by potential new alcohol consumers, especially youngsters. It is true that in 2C1 taxation, taxes on cheap alcoholic beverages are determined on the basis of specific tax because it gives a higher tax on cheap alcoholic beverages than ad valorem taxation. Expensive alcoholic beverages, on the other hand, are taxed on the basis of ad valorem taxes putting their taxes onto a higher level than specific taxes on these beverages.

Basically, the effects of the Thai 2C1 taxation are, or should be, what Rehm and his colleagues are presenting. However, we can question some of their assumptions. First, are heavy drinkers really preferring certain beverages, or are the beverages they actually prefer an outcome of their full price? For instance, in Finland in the early 1950s white spirits were the beverages preferred by heavy alcohol consumers. After certain changes in relative alcohol availability fortified wines became, in the 1950s, the most important beverage for becoming intoxicated, and after changes in relative physical and economic availability in the early 2000s semisweet white wines were the beverages preferred by marginalized heavy alcohol consumers [2,3]. It is also not clear that young novice drinkers would prefer certain alcoholic beverages independent of their full prices.

Secondly, the paper accepts Thailand's 2C1 taxation's official motivations as they are most certainly written in the documents. However, at least when trying to propose the Thai alcohol taxation as a model for low- and middle-income countries, it should be remembered that the state has several interests with regard to alcohol. As well as maintaining public order and safety and the health of the population, the state also has an economic development interest with regard to the alcohol industry and trade [4]. It can be assumed that these economic interests are the explanation as to why white spirits, followed by wine coolers, have excise tax rates as 1.82 Thai Baht (THB) and 2.36 THB per 12 g of alcohol compared to about 6 THB with regard to domestic whisky and at least 7 THB with regard to domestic beer. With reference to white spirits, this exceptionally low excise tax rate is based on specific tax; and regarding wine coolers on 25% ad valorem tax compared to 60% ad valorem tax regarding beer.

The 2C1 model is an interesting model; but in order to investigate its real effects on youthful drinking and alcohol-related harm, we need to have a case where this model is implemented as it is really supposed to work, with the same specific tax rate as well as with the same ad valorem percentage for all beverages, not as it is now working in Thailand, with important exceptions motivated by political reality.


  1. Top of page
  2. Declaration of interests
  3. References