The Irish government has announced its Budget for the coming year, in which it has increased the rate of excise duty on a packet of 20 cigarettes by 50 cent.
This follows successive tax increases on tobacco in recent Budgets - 40 cent in 2015, 10 cent in 2014 and 10 cent in 2013.
A spokesperson for John Player tobacco, an Imperial Brands company that operates in Ireland, criticized the move, saying "Ireland’s thriving black market is well placed to meet the demand that will now be created by today’s 50c excise increase."
The Irish government did stop short, however, of increasing excise duty on alcoholic drinks, a move that was welcomed to a degree by industry groups, however a decrease in excise had been sought.
“The drinks industry is operating in an extremely difficult and uncertain economic climate," said Donall O’Keefe, secretary of the Drinks Industry Group of Ireland, "so the Government’s decision today not to not cut excise on alcohol is a missed opportunity for the industry as we approach the Christmas trading season and the increased threat of cross border shopping. Irish consumers continue to pay the highest prices for alcohol in Europe."
In addition, there was criticism for the government's pledge to introduce a 'sugar tax' on soft drinks, with the Irish Beverage Council saying, "Internationally, this thesis has been tested and has a 100% failure rate. A sugar tax will hit consumers, industry and the economy for no public health benefit."
© 2016 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. To subscribe to ESM: The European Supermarket Magazine, click here.
