Pre-budget cigarette shortages the norm

Cigarettes are in short supply in Nepal as traders hoard tobacco products in expectation that their prices will go up after the budget, according to a story in Republica.

The budget is scheduled to be brought down in the middle of this month.

Retailers say that since the government generally raises taxes on tobacco products through the budget speech, wholesalers are hoarding cigarettes so as to make a quick profit.

Wholesalers, however, rebut the allegations. They say it is the manufacturers and distributors who have reduced supply and that there is nothing wholesalers can do about it.

And manufacturer Surya Nepal is blaming the wholesalers and retailers for the shortage. Some big wholesalers and retailers were receiving increased supplies of cigarettes but were hoarding them, it said.

“Shortage of tobacco products before budget speech has become a usual phenomenon for the past few years as traders know prices of tobacco products will increase after the budget speech,” said Ravi KC, vice president of Surya Nepal.