Smokers in Greece May See Cigarettes Almost Double in Price

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Smokers successful Greece are facing the imaginable of drastically higher prices, with the outgo of a battalion of cigarettes projected to leap from the existent mean of astir €4.60 (around $5.30) to astir €7.00 ($8)—an summation of implicit 50 percent.

This imaginable hike is simply a nonstop effect of a monolithic tax betterment projected by the European Commission, which aims to bring successful important taxation gross portion aligning taxation with nationalist wellness goals crossed the bloc.

The European Commission’s sweeping taxation proposal

The initiative, which involves the revision of the Tobacco Taxation Directive (TTD) and the instauration of a caller European levy (TEDOR), seeks to modernize the EU’s baccy taxation framework, which hasn’t been importantly updated since 2011. The halfway of the Commission’s connection centers connected importantly raising the minimum excise duties connected astir each baccy and nicotine products.

The astir assertive script supported by the Commission and expected to output an estimated €15.1 cardinal successful further EU taxation gross is simply a 139 percent summation successful cigarettes and a 258 percent summation successful roll-your-own tobacco.

The Commission justifies the monolithic hikes by stating that higher baccy taxes and prices are the astir effectual measurement to reduce wide baccy use, citing that accrued taxation since 2011 is linked to a 40 percent simplification successful smoking successful the EU. The program is besides portion of the broader Europe’s Beating Cancer Plan with a extremity of a “tobacco-free generation” by 2040.

Reservations implicit steep cigaret outgo increase: The menace of smuggling and economical interaction successful Greece

While Greece, on with Italy and Romania, supports the rule of aligning taxation with nationalist health, it is simply a starring dependable among skeptical subordinate states arguing that the increases are excessively steep.

At the caller Economic and Financial Affairs Council (ECOFIN) meeting, Greek Minister of National Economy and Finance, Kyriakos Pierrakakis, delivered a wide warning, highlighting 2 large concerns:

Increased smuggling: Based connected Greece’s acquisition and geographical determination (bordering non-EU countries), the Minister stressed that “increasing these taxation rates leads to a emergence successful smuggling.”
Economic harm: Pierrakakis argued that if prices connected some accepted and caller products “increase sharply and beyond what the marketplace tin bear,” it volition negatively interaction the competitiveness of the Greek baccy industry, affecting some investments and exports.

To mitigate these risks, Greece projected a much mean approach, advocating for little taxation rates than those projected by the Commission, a longer transitional play to let the marketplace to adjust, and imposing taxes based connected the value of the product, alternatively than the finished portion (particularly for innovative products).

Smoker prevalence successful Greece

Greece has historically maintained 1 of the highest smoking rates successful the European Union, making the taxation statement peculiarly sensitive.

According to caller data, Greece consistently ranks astatine oregon adjacent the apical of the EU for smoking prevalence, with big smoking rates hovering astatine astir 30 percent of the colonisation (compared to an EU mean person to 20 percent). Some studies person adjacent identified Greek women arsenic “champions” of smoking wrong the bloc and Greek teenagers arsenic starring successful vaping rates.

Given its precocious existing depletion rates and borderline vulnerability, Greece faces a superior hazard of tax-driven terms hikes starring to an enlargement of the illicit cigaret market, which already accounts for a notable percent of the full cigaret market. The government’s halfway fearfulness is that excessively precocious ineligible prices volition simply determination consumers towards untaxed, amerciable products.

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