Tobacco Manufacturers respond to Budget 2017

The ITMAC (Irish Tobacco Manufactuers' Advisory Committee) has responded to the latest price hike on tobacco products, expressing strong disagreement with the Budget 2017 decision.

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12 October 2016 | 0

Joan Mulvihill, director of the Irish Tobacco Manufacturers’ Advisory Committee, has expressed strong disagreement with Government’s decision to increase excise on tobacco products by 50 cents in Budget 2017.

“The Government is ignoring the evidence,” Mulvihill said, “which demonstrates that tax increases of this magnitude shock the market and can be expected to lead to a decrease rather than an increase in excise revenues. This increase results in a significant tax gap.

“Last year’s Ipsos MRBI research shows that in 2015 the black market grew for the first time since 2009,” she added.

Repeated excise hikes are not the solution to achieve Government’s objectives in terms of public health, they are just moving people back into the black market, the group said.

“Big excise increases just achieve one goal,” said Joan Mulvihill. “They amplify the price differential between legal and illegal cigarettes, making it more and more attractive for smokers to look for smuggled products and for criminals to run this business. The Government is again undermining the legitimate tobacco industry and retail, while not achieving any policy objective.”

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