Health bodies look to attack tobacco profits by closing cigarette price gap

The Irish Heart Foundation (IHF) and the Irish Cancer Society (ICS) are calling in their pre-budget submissions for tobacco tax measures that would close the price gap between less expensive and premium brands, according to a story by Dan Buckley for the Irish Examiner.

Cigarette prices in Ireland range between €8 and €9.85 per pack,

“We are calling on the Minister for Finance to adjust the structure of tobacco taxation to ensure tax increases benefit the Exchequer, rather than the tobacco industry,” said Kathleen O’Meara, head of advocacy and communications at the ICS.

“Our current tobacco tax structure enables smokers to down-trade to cheaper brands rather than quit, and while this option is available, price increases will be less effective.”

Younger smokers especially have been switching to less expensive brands of cigarettes, according to an opinion poll conducted for the ICS and IHF.

So while about 66 percent of smokers of all ages now choose brands based on price, that rate rises to 74 percent among 18- to 24-year-olds, the countrywide poll of 1,000 adults shows.

“We know that tobacco companies in Ireland make profits of up to 55 percent after duties on sales, compared to regular profit margins of 12-20 percent for consumer goods,” said Chris Macey of the IHF.

“By changing the tax structure we can achieve the double whammy of preventing these firms from keeping smokers hooked through lower prices, while also ensuring they pay more towards the massive health costs associated with their deadly products.”

The ICS and IHF also want an annual price escalator of inflation plus 5 percent on cigarettes, which, if applied, would cause the price of a pack to increase by 50 cents in October’s budget.