Health Groups Call On Irish Govt To Increase Tobacco Taxes
Irish health groups have called on the Government to introduce annual tax increases on tobacco products of 5 percent above inflation.
In their joint pre-Budget submission, the Irish Heart Foundation and Irish Cancer Society claim that this would result in a 6.2 percent hike in the price of cigarettes this year alone.
They are concerned that tobacco firms are able to generate profit margins of up to 55 percent after duties on sales. Smoking-related illnesses cost Ireland around EUR2bn (USD2.6bn) a year, while total tobacco tax receipts stood at just EUR1.42bn in 2011. The submission argues that by reducing industry profits to approximately 12 to 20 percent, the Government could take up to EUR65m in extra tax from tobacco companies.
Also stressed in the submission is the need for the Government to adjust the structure of tobacco taxation, to ensure that tax increases benefit the Exchequer rather than the tobacco industry. A price escalator for taxes on all tobacco products of at least 5 percent above the rate of inflation would, based on an annual inflation rate of 1.2 percent, result in a price increase of 6.2 percent.
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