The Conference of the Parties (COP) to the Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC) is a series of international meetings to negotiate and implement agreements to address climate change. The COP meetings, also known as the “Climate Summits,” are attended by representatives from countries around the world. The COP21 to UNFCCC was held in Paris in December 2015. This conference resulted in the Paris Agreement, which is a legally binding agreement to combat climate change and to accelerate and intensify the actions and investments needed for a sustainable low carbon future.

As a party to the UNFCCC, Thailand submitted its Intended Nationally Determined Contributions (INDCs) prior to COP 21, outlining the state’s targets and actions to reduce greenhouse gas emissions and adapt to the impacts of climate change. In its INDCs, Thailand has committed to reduce its greenhouse gas emissions by 20% under the “business-as-usual” scenario by 2030, with a view to further reducing emissions by 80% by 2050. The country also has committed to increase the share of renewable energy in the total primary energy mix to 30% by 2036, and to enhance the energy efficiency in the industrial and building sectors. After the COP 21, Thailand continues to participate in the follow-up COPs and to work towards the implementation of its commitments under the Paris Agreement. In addition, Thailand has also implemented several policies and regulations to support the reduction of greenhouse gas emissions, while considering various economic instruments.

Economic instruments are policy tools that use market mechanisms to encourage or discourage certain behaviors in order to achieve goals. These tools can include taxes, subsidies, tradable permits and deposit-refund systems. Economic instruments for the environment can be an efficient way to achieve environmental goals as they use the power of market mechanisms to influence behavior and to promote sustainable development which can also be more cost-effective than traditional command-and-control regulations. Popular economic instruments for environmental issues include taxes, subsidies, tradable permits, and deposit-refund systems.


Problems by Plastic Pollution

The use of plastic is not only having negative impacts on ecosystems, wildlife, human health, and economies but also can contribute to climate change in several ways, including:

  1. Carbon emissions: The production of plastic requires fossil fuels, such as oil and natural gas, which release carbon dioxide (CO2) and other greenhouse gases into the atmosphere when burned. The more plastic is produced, the more fossil fuels are consumed, which leads to an increase in carbon emissions.
  2. Methane emissions: Plastic waste that is not properly disposed of can end up in landfills or the natural environment, where it can break down and release methane, a potent greenhouse gas.
  3. Deforestation: Plastic production can also contribute to deforestation, as some plastic products, such as palm oil-based plastics, are produced using crops grown on land that was previously forested. Deforestation hinders the ability of forests to absorb CO2 from the atmosphere.
  4. Energy consumption: The production, transportation and disposal of plastic also consumes energy, which in turn contributes to the greenhouse gas emissions.
  5. Microplastics: Plastic waste that ends up in the ocean can break down into small particles called microplastics, which can be ingested by marine life and other organisms. Microplastics can also absorb pollutants, such as pesticides and industrial chemicals, which can then be passed up the food chain, potentially affecting human health and the environment.

As such, reducing plastic consumption and waste thereof is important not only for combatting climate change but also for protecting the environment and human well-being in general.


About Plastic Tax Scheme

Plastic tax is one of economic instruments that many of the countries use as a way to manage the environmental impact of plastic waste. It works by increasing the cost of using certain single-use plastic products, such as bags, straws, and cutlery, which in turn reduces the consumption of these products. The reduction in consumption of plastic products leads to a decrease in the amount of plastic waste to be generated, which helps to mitigate the negative environmental impact of plastic pollution.

By increasing the cost of plastic products, a plastic tax creates an economic incentive for consumers to choose more environmentally-friendly alternatives, such as reusable bags, paper straws, or metal cutlery. It also creates an economic incentive for producers to develop and market more sustainable alternatives to plastic products. Additionally, the revenue earned by a plastic tax can be used to fund waste management and clean-up efforts, as well as to support research and development of more sustainable materials and technologies.


Discussion on Plastic Tax in Thailand

Office of Trade Policy and Strategy, Fiscal Policy Office, Ministry of Finance announced, in its press release, that it was reviewing how plastic taxes were used in other countries. The press release also referred to the European Union (EU) which created the European Green Deal as an action plan to meet its goals of reducing greenhouse gases. A plastic tax is part of the Green Deal and has been implemented since January 1st, 2021. EU members must pay a tax calculated on the volume of single-use plastic packaging at the rate of 0.8 euros per kilogram. Some countries, such as Italy and Spain, have imposed tariffs on manufacturers, sellers, buyers, suppliers, and importers of plastics. The United States is reviewing “Reduce Act of 2021” that would impose tax on non-recycled plastic and single-use plastic packaging at a rate of $0.2 to $0.5 per pound. Many local governments in the United States have already collected tax on single-use plastic bags at the rate of 5 cent per bag.

In Thailand, a voluntary plastic bag tax has been introduced since 2021. This scheme encourages retailers to charge customers a certain fee for plastic bags. However, there is still no official tax imposed on plastic or plastic packaging. Recently, the cabinet has approved an exemption of corporate income tax for the purchase of biodegradable plastic products from manufacturers certified by the Office of Industrial Economics. A press release issued by the Office has further analyzed and stated that although plastic taxes that have begun to be used in many countries, they should not significantly affect Thailand’s exports. Because plastic products accounted for only 2.07% of Thailand’s total export value. However, since plastic tax has already become a trend in various markets, Thailand must prepare to support its adoption and seeking market opportunities to export products that meet consumer needs such as,

  • Research and development on innovative plastic packaging by taking advantage of Thailand as a source of raw materials such as sugarcane, cassava and maize that can be further developed into bioplastic products;
  • The development of traceability systems and standards for plastic packaging containing recycled plastic; and
  • Promoting and pushing the export of bioplastics in response to the needs of the market or buyers and trend on sustainable business.

Office of Trade Policy and Strategy (Public Organization), Ministry of Commerce has also issued a press release in response to the trend on plastic tax, which states that currently consumers are more aware of environmental conservation. A survey has shown that in Thailand, more than 20% of general consumers response that they are more concern about the environmental issues. Thus, the consumers are more willing to buy products that use biodegradable packaging or packaging that is made from more natural materials.

Office of Trade Policy and Strategy gives advice to companies that the solution to keep the environment free from plastic is to use advanced technology and innovation. This has resulted in a lot of research on environmentally friendly packaging, such as edible drink bottle made from brown algae with calcium compounds that was demonstrated in the London Marathon; product packaging made from sugarcane, corn, cassava, can biodegraded in 180 days can be used instead of paper and polystyrene foam; as well as recycle packaging made from one type of plastic such as polypropylene (PP), which is easy to recycle and uses at low cost and can actually be produced commercially mono-material packaging. Mono-material packaging uses the same type of plastic material with a main purpose for recycling that does not require classification of plastic waste.


Current Situation of Plastic Tax of Asian Countries

There are many examples of how plastic taxes have already been implemented in many countries in Asia. That is,

  • China: In 2020, China introduced a tax on the production and import of certain single-use plastics, including bags, cups, and tableware.
  • Indonesia: In 2020, Indonesia introduced a plastic bag tax, which requires retailers to charge customers a fee for plastic bags.
  • South Korea: In 2018, South Korea introduced a plastic bag tax, which requires retailers to charge customers a fee for plastic bags.
  • Malaysia: In 2018, Malaysia started to impose a tax on plastic bags, which requires retailers to charge customers a fee for plastic bags.
  • Philippines: In 2019, Philippines introduced a tax on plastic bags, straws, and other single-use items.

Considering such a trend and how the government is advertising on the issue, it will be not long that Thailand will follow the global trend.