To pave the way for the new tax calculation structure, the department needs to amend as many as seven laws: the Liquor Act of 1950, the Tobacco Act of 1966, the Playing Card Act of 1943, the Excise Tariff Act of 1984, the Excise Tax Act of 1984, the Allocation of Excise Tax Act of 1984 and the Allocation of Liquor Tax Act of 1984, said director-general Somchai Poolsavasdi.
The state-recommended retail price will be set by the Excise Department, and the department will also take the market price into account.
The proposed excise tax base restructuring is part of the Finance Ministry's comprehensive tax reform.
The junta recently instructed the ministry to focus on taxes that could foster fairness and narrow inequalities.
The proposal follows a Thammasat University study on excise tax collection efficiency improvement, as requested by the department.
"The amendments are aimed at making the excise tax structure fairer, more transparent and compliant with international standards," Mr Somchai said, adding that higher excise tax collection was not the main goal.
He said if products were levied at a higher tax rate after the restructuring, the department would consider reducing the rate for these products to prevent manufacturers passing on the burden to consumers, under the concept of tax neutrality.
A new tax base structure would address a lengthy dispute over the unfairness of excise duty collection, as all goods would be taxed based on the same standard, Mr Somchai said.
Last year, the Excise Department changed its tax for liquor to the last wholesale price before reaching consumers instead of the ex-factory price, but producers criticised this system since some factors that influenced liquor prices were beyond their control. The liquor excise tax would also be based on the state-recommended retail price under this proposal.
A Finance Ministry source said manufacturers often understated their ex-factory price so they could pay less in tax than they should.
The current tax structure does not reflect reality, and this prompted the revision, the source said.
State revenue collection fell by 132 billion baht to 1.678 trillion baht or 7.3% short of its target for the first 10 months of this fiscal year due mainly to lower-than-expected value-added tax on imported products, excise tax on vehicles and corporate income tax.
Keeping the excise tax on diesel also affected revenue collection.
Last month, state revenue of 130 billion baht missed the target by 17.8 billion or 12.1%.
The target for revenue collection in fiscal 2014 is 2.275 trillion baht.
The Finance Ministry recently estimated revenue would fall at least 100 billion baht short of the target.