Thailand to introduce 'Salt Tax' with tiered rates, driving health food market boom
Officials reveal that the new tax will adopt a tiered-rate structure similar to the sugar tax.
Industry observers are closely watching how this policy will impact the beverage, snack, and food sectors, where companies are already accelerating development of 'low sugar' and 'low sodium' products to stay competitive.
Experts point out that these tax measures are set to fundamentally reshape the market landscape.
The introduction of tax rates based on sugar and sodium content is causing a major ripple in the consumer goods market—particularly affecting drinks, snacks, and instant noodles.
Major producers are increasingly investing in low-sugar and low-sodium formulations to reduce future tax burdens.
The sugar tax has already been fully enforced since April 1, 2025, while the salt tax is expected to be implemented soon. These policies are propelling the healthy food sector into a rapid growth trajectory, turning it into a 'Blue Ocean' opportunity.
Tiered salt tax expected soon
Kulaya Tantitemit, Director-General of the Excise Department, told Thansettakij that the department is studying the implementation of a salt tax aimed at improving public health.
The tax is expected to use a tiered rate structure, just like the sugar tax.
Consultations are underway with key stakeholders, including the Ministry of Public Health, food and beverage manufacturers, the Thai Food and Drug Administration (FDA), the Federation of Thai Industries, and networks advocating for reduced salt consumption, to ensure that the policy aligns with current market conditions.
'According to WHO guidelines, the daily sodium intake should not exceed 2,000 mg per person. However, Thais consume more than twice that amount—around 3,600 mg per day.
"To prevent health issues, we plan to use tax policy as a tool to influence both production practices and consumer behavior," Kulaya explained.
'We will aim to minimise the impact on manufacturers' costs.'
According to current data, the top three high-sodium foods in Thailand are: Instant noodles, snacks, and frozen foods.
The Excise Department will identify target products and set sodium content criteria to determine the tax structure.
Essential foods for daily living will also be considered for special guidelines.
'The salt tax will primarily focus on sodium content. We will determine appropriate measurement standards, define sodium thresholds, and establish corresponding tax rates. This tax will be tiered—just like the sugar tax.'
Sugar tax shows measurable results
Since April 1, 2025, the Excise Department has entered the fourth phase of sugar tax enforcement, applying tiered rates as prescribed by law.
Manufacturers that do not reduce sugar content in line with legal limits face a tax rate increase of up to 5 baht per liter.
In practice, many companies have already reduced sugar content since the second phase of the sugar tax began on October 1, 2021.
'Beverage producers have responded by reducing sugar content over the past few years. As a result, high-sugar beverages have become less common, while low-sugar alternatives have proliferated,' said the department.
Between 2015 and 2017, there were only 216 products that earned the 'Healthier Choice' nutrition label. By March 2023, this number had jumped to 1,863 products, indicating a strong market shift toward healthier alternatives.
Food and beverage companies rush to reformulate
Asst Prof Dr Ake Pattaratanakun, Head of the Marketing Department and Chair of the Master's Program in Branding and Marketing at the Faculty of Commerce and Accountancy, Chulalongkorn University, commented on the effects of the sugar and salt tax policies.
He observed a major shift among large beverage manufacturers like Coca-Cola and Pepsi, who have placed greater emphasis on "low sugar" products.
Other producers in the food and beverage industry have followed suit, reformulating products to provide healthier options—for instance, reducing sugar in jams or developing drinks using alternative sweeteners.
'From the business perspective, one major concern is whether the tax burden will be passed on to consumers through higher prices,' he said.
'However, analysis shows that broad price increases have not yet occurred. This is mainly due to two factors: intense market competition—especially in the energy drink and soft drink sectors, where consumers have many choices and can easily switch brands if prices rise; and the ongoing economic recovery, which makes companies cautious about raising prices for fear of losing sales.'
Because raising prices is not a viable strategy, many businesses have focused on developing new products with lower sugar content or sugar substitutes to reduce their tax liabilities.
A clear example is Coca-Cola, which has released more sugar-free products such as Coke Vanilla Zero Sugar, Sprite Zero Sugar, Fanta Zero Sugar, and Lipton Lemon Iced Tea Sugar-Free.
These products are typically designed to look and taste very similar to their regular versions, so that consumers don't notice the change.
Spotlight on snacks and instant noodles
Ake further analyzed that from a consumer perspective, the increase in "low sugar" and healthier alternatives is a positive trend, offering more diverse choices.
Interestingly, many consumers may not even realize they're consuming less sugar or sugar-free products, as the taste and appearance remain largely unchanged.
Beyond the sugar tax, the upcoming salt tax on snacks and instant noodles is another development to watch.
It is expected that businesses will respond similarly—by adjusting prices or reformulating products to lower sodium levels.
However, the snack industry may adopt different strategies, such as reducing portion sizes in packaging while keeping prices the same—something that consumers might not immediately notice.
Health market heats up amid fierce competition
Analysing the market outlook and marketing strategies under the new "health tax" era, Ake noted that in the short term, producers will focus on developing products with reduced sugar and sodium to lower tax burdens and cater to growing health-conscious demand.
The "health product" segment will become increasingly competitive.
In the medium to long term, health trends will continue to shape market direction.
Marketers must emphasise clear, honest communication about health benefits of their products—moving beyond strategies focused solely on tax avoidance.
The true goal should be the development of genuinely healthier products for consumers.
The sugar tax—and the looming salt tax—are key forces reshaping the landscape of the beverage and snack industries.
Producers must adapt quickly and decisively, focusing on the authentic development of health-oriented products while effectively educating and communicating their value to consumers.
Marketers who can strike the right balance between health, taste, and price will be best positioned to win in this increasingly competitive market.
Advancing 'healthier choice' product development
Salinla Seehaphan, Executive Director of Corporate Affairs at Nestlé (Thailand) Ltd., stated that Nestlé is committed to promoting good health and quality of life for Thais through the continuous development of nutritious and delicious products.
Nestlé has participated in the 'Healthier Choice' nutritional labeling program since its launch in 2017.
Currently, 115 of its products across five categories—beverages, seasonings, dairy products, ice cream, and breakfast cereals—carry the certified Healthier Choice logo.
'Nestlé's product development is guided by expertise from our global R&D centers, aiming to create innovative foods with good nutritional value and great taste. The focus is on:
1. Reducing nutrients linked to non-communicable diseases (NCDs) such as sugar, fat, and sodium, while maintaining taste. For example, we use specialized enzymes to lower naturally occurring sugars in ingredients like malt, milk, and fruit juice.
2. Fortifying products with essential vitamins and minerals at accessible prices. In 2024, Nestlé developed 3.4 million fortified servings targeting Thai people across all age groups—addressing common deficiencies in iron, iodine, zinc, and more.'
Global reformulation strategy
Chanin Thiencharoen, Marketing Manager at AJE Thai Co., Ltd., the producer of Big Cola, stated that the current soft drink market is highly competitive, driven by brand and flavour.
He noted that the company was not affected by the Phase 4 sugar tax, which took effect on April 1, as it had long since reformulated its products to comply with the new regulation. They have managed to maintain original pricing.
'We have continually adjusted our formulas and ingredients to align with the health needs of consumers seeking lower sugar content. This is not just a Thai-specific adjustment—it is a global strategy, as Big Cola is an international brand.'
Consumer health consciousness has intensified competition in the low-sugar segment.
The soft drink market is now split into two major groups: those who seek refreshment, and those who prefer reduced sugar—the latter currently making up about 10% of the market, with signs of steady growth.
Despite these trends, soft drink consumption continues to grow modestly by 2–3% annually.
'Cola-type' beverages dominate the market, accounting for 85% of the total soft drink market, which is valued at around 60 billion baht.
The summer season marks a high point for the industry, generating over 30% of annual sales in just three months.
New standards for jams and jellies
The Ministry of Public Health recently issued new regulations for jams, jellies, and marmalades. Lertchai Lertvut, Deputy Secretary-General of the Food and Drug Administration (FDA), announced Notification No. 455 (B.E. 2568), which will take effect on June 9, 2025.
The goal is to align Thai regulations with the international Codex Alimentarius food standards, reduce regulatory redundancy, and address industry feedback.
Key updates include:
- More sweetener options for product variety
- Clearer and more flexible ingredient guidelines
- Improved labeling requirements, making product information more transparent and easier for consumers to understand
These updates support growing consumer demand for health-conscious products with varying levels of sweetness and ingredients.
They also elevate Thai production standards to international levels, helping build consumer trust in the safety and quality of jams, jellies, and marmalades. - The Nation/ANN
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