Budget: Forest Eireann calls for reduction in tobacco tax
Wednesday, December 1, 2010 at 10:37AM A smokers' lobby group has called for a reduction of €1 on a packet of 20 cigarettes to counteract the sale of illicit tobacco and protect "the weakest in society" including children, the elderly and the unemployed.
In a pre-Budget letter to Finance Minister Brian Lenihan, Forest Eireann wrote:
"Tobacco duty in Ireland is already at record levels and it is no coincidence that the country has been described as a tobacco smuggling blackspot. Any reasonable assessment of the impact of increasing tobacco tax above and beyond the existing level must conclude that a further increase will benefit only the smugglers, some of whom have been reported to use children as young as 12 to sell illicit cigarettes door to door, and as young as seven at open air markets.
"It makes economic sense to not only freeze the tax on tobacco for another year but to reduce the tax by €1 per packet of 20 cigarettes. This would not only encourage those who choose to smoke to purchase their tobacco via legal channels, it would also help maximise revenue to the Exchequer."
The group also urged the Government to consider the social harm that could result from a further increase in tobacco taxation.
"Excessive taxation on consumer goods hits the elderly and the less well-off harder than anyone. In a recession we believe it is immoral to penalise those who can least afford the increase that the tobacco control industry is demanding."
Forest Eireann dismissed a demand by Ash Ireland for an increase of €1 on a packet of 20 cigarettes in the budget. Spokesman John Mallon said:
"Evidence suggests that excessive taxation encourages smuggling and criminality, and that in turn leads to a loss in revenue and an increase in overall consumption because of the sheer volume of cheap tobacco that is available on the black market.
"Governments must protect the weakest in society and we believe that increasing the tax on tobacco will make children, the elderly and the unemployed more vulnerable to the smugglers and the criminal gangs.
"We hope that the Budget will reflect the economic and social reality and not the fool’s paradise that some tobacco control advocates would have us inhabit.
"The economic climate has changed dramatically and the country is forced to embrace a new reality. We hope that the Finance Minister will share our view that targeting smokers during a recession is social and economic madness."
Further comment
John Mallon (Forest Eireann) 085 219 3245
Download our Pre-Budget letter to the Finance Minister
Reader Comments (4)
This seems very timely, John.
"More than 114 million cigarettes worth €38m have been seized byCustoms over a three-month period. The Irish Tobacco Manufacturers Advisory Committee (ITMAC) warned the illegal tobacco trade is sweeping across the country, withCork becoming a major target for smugglers. Figures showed that between April to August some 25 million illegal cigarettes were seized across Cork, with a value of €8.3m. Just four people were prosecuted for the sale of illegal tobacco. At the same time 31.5 million were seized in Dublin and 45.7million in the north east of the country. An ITMAC spokesman said a scanner is needed in the south of the country to stop Cork being a hub for criminal gangs. “We recognise that the country is in a difficult situation atthe moment but a new scanner will pay for itself, while helping to put more money into the Irish economy and cutting the supply to criminals,” said a spokesman."
http://www.irishexaminer.com/breakingnews/ireland/plea-for-scanner-as-cigarette-smuggling-industry-booms-483612.html
I would also suggest that the irish Government read up on this brand of Russian cigarette called Jin Ling, I was offered a packet the other day and purchased it for research purposes. This is obviously relevent to plain packaging of cigarette packets.
Jin Ling is manufactured in Russian and has no legitimate market. Every single cigarette is manufactured, distributed, brought and sold illegally. There are 24 billion produced every year, about 7% of cigarette production in Europe.
"Overland to Germany, and from Baltic or Black Sea ports, the cigarettes are passed to criminal networks in at least 12 countries — Germany, the United Kingdom, Poland, Latvia, Romania, Greece, Turkey, Italy, Bulgaria, the Netherlands, Belgium, and France."
"But Jin Ling’s extraordinary growth also raises troubling questions about the future of tobacco smuggling, which until a few years ago was dominated by big Western companies looking to gain market share. Baltic Tobacco’s operations suggest how easy it may be for new players to step into channels used previously by Big Tobacco, using the same equipment, production standards and styles, and even the same recently vacated factories."
I have no problems buying tobacco from white van man, but organised crime, I draw the line.
http://www.publicintegrity.org/investigations/tobacco/articles/entry/763
Thanks for that second link, Dave Atherton! I like the goat instead of the camel!!
In a sense, one should be pleased about the smuggling. It is proof that interfering with people's personal habits by government is as fatuous as a dog's chasing its own tail. What goes round, comes round, as they say. I've put a bit more in a Facebook thread:
http://www.facebook.com/mjrpeel/posts/107344442672064#!/williamlambton/posts/152718481440944
Excellent letter, John - read in full. There will soon be a new madhouse syndrome: Tobacco Ban Dementia. There are signs that there are already many candidates, being driven mad by the failure of their own righteousness!