Cigarette tax rise predicted

Japan’s government plans to increase tobacco tax by ¥3 per cigarette, according to a story in The Jiji Press citing ‘informed sources’.

Currently, the tax per cigarette stands at about ¥12.2. The tobacco tax was last raised in October 2010, by ¥3.5 per cigarette.

To avoid a steep plunge in tax revenue due to the potential decline in consumption that might occur after a tax rise, the tax will be raised in stages of ¥1 per cigarette over four years, starting in fiscal 2018.

The government plans also to raise taxes on heat-not-burn tobacco products, which have become popular recently. Details about the increase in taxes on these products, which currently attract a lower rate of tax than do combustible cigarettes, will be discussed later.

The tobacco tax increase will be included in the government’s fiscal 2018 tax-reform package, which is expected to be published on December 14.