The Irish Tobacco Manufacturers’ Advisory Committee (ITMAC) has voiced its disapproval of Budget 2017, amid worries that it will fuel a black market for tobacco products.
Joan Mulvihill, ITMAC Director, expressed strong disagreement with Government’s decision to increase excise on tobacco products by 50 cents: “Again, the Government is ignoring the evidence 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, resulting 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. 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.
“Big excise increases just achieve one goal. 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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