The alcohol industry has questioned the Public Health Ministry's plan to impose a 2-per-cent "sin tax" on alcohol products - which would raise the duty levied to 4 per cent - believing that it is a misdirected effort to solve alcohol-related social problems.

The industry has also pressured the ministry to increase the tax on white liquor, responsibility for which Public Health Minister Mongkol na Songkhla has promptly handed to the Commerce Ministry.

The increase in alcohol and cigarette taxes was proposed on Tuesday following reports that alcohol producers could withdraw their sports sponsorships if the government implements the 24-hour advertising ban on all alcohol products.

The increase is expected to raise Bt2 billion for the government each year, and part would be used to support sports activities to replace sponsorship lost to the alcohol ad ban, which will be enforced from December.

The Tourism and Sports Ministry has estimated that the advertising ban would lead to the cancellation of the Bt130-million budgets prepared to sponsor tourism and sports events such as golf tournaments and motor rallies in the next couple of months.

While alcohol and cigarette companies plan to drop their Bt100-million sponsorship for golf and rally activities, other private operators are also considering shelving the Bt30-million sponsorship for sports activities such as tennis.

Minister Suvit Yodmani said the Tourism Authority of Thailand (TAT) and the Sports Authority of Thailand were compiling estimates of total damage from the cutting of budgets for tourism and sporting sponsorships.

Somchai Suthikulpanich, senior vice president of Thai Beverage Marketing -the distributor of Chang beer - yesterday doubted whether tax money had been used efficiently.

"The Thai Health Promotion Foundation already has Bt2 billion from the 2 per cent it levied earlier. If another 2 per cent is taken, it will have Bt4 billion at its disposal. So far the Bt2 billion has not even been completely used," said Somchai.

Chatchai Viratyosin, marketing manager at Singha Corp, the brewer of Singha beer, said the company did not mind the extra tax, but believed such a solution to be only superficial. Not only does it not tackle the problem head-on, problems might arise in managing the fund, he said.

"Increasing alcohol tax does not reduce alcohol consumption. Conversely, it might drive producers into a price war," he added.

Wilamon Udomporn, an executive of Riche Monde, said his company would also not mind the additional tax, but would like more clarification on how the funds would be used. She added that the government had yet to announce the details of how the budget would be spent.

As to whether the excise tax on white whisky will be raised, Minister Mongkol said the decision was up to the Finance Ministry.

To strengthen self-regulation and soften the government's control, the Federation of Alcohol Control of Thailand yesterday issued an 11-point Code of Conduct. However, missing from the code signing were big players, including Thai Beverage and Singha Corp.

Meanwhile, Parames Ratjaiboon, honorary president of the Advertising Association of Thailand (AAT), said the amended version of the Alcohol Act still contained some loopholes that would not result in a reduction of alcohol-related accidents and consumption because it failed to address the consumption of white alcohol, the most popular drink.

According to excise figures, 75.65 per cent of alcohol consumption is white whisky, 4.8 per cent is mixed alcohol, 9.8 per cent is special whisky, 0.2 per cent is specially blended whisky, while 3.1 per cent is wine.

With the 24-hour ban on above-the-line alcohol advertising effective from December 3, Parames doubted whether it would really solve social problems. Previous sporadic regulations, such as forbidding alcohol products in programmes, no broadcast advertising before 10pm, and no billboards within school areas, failed to reduce the number of drinkers and alcohol-related accidents, he said.

The new Alcohol Act also had no input from the producers. "If the government thought that alcohol advertising really lures people into drinking alcohol, then anti-alcohol advertising would clearly have the same effectiveness. Instead the government refused to collaborate with advertisers and advertising agencies to solve the problems together. It tends to see advertising as the enemy," said Parames.

The AAT does not mind the ban on alcohol commercials, but would like the government to clarify the standards it used to ban certain kinds of advertising. Parames believes the ban could be extended to products in other categories, such as energy drinks, snacks, or fast-food products and services.

Instead of reducing the number of drinkers as intended, the ban would force advertisers to concentrate on below-the-line marketing, employing tactics such as trade promotions with shops and point-of-sale promotions, he said.

With 39 days left before the 24-hour ban comes into force, advertisers have intensified their activities, hoping to exploit the little time remaining.