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Tag: tobacco tax

  • Clashing Protests On Both Sides of Bangladesh’s Tobacco Tax Debate

    Clashing Protests On Both Sides of Bangladesh’s Tobacco Tax Debate

    Civil society groups in Bangladesh formed a human chain and called for higher tobacco taxes and pricing reforms ahead of the 2026–27 national budget at a protest in Tangail today (May 4). Organizers, including the Development Organization of the Rural Poor (DORP), urged the government to merge lower cigarette price tiers and raise minimum prices, proposing Tk100 ($0.81) per 10-stick pack for the lowest tier and a uniform 67% supplementary duty alongside a specific tax of Tk4 ($0.03) per pack. Speakers said low and mid-priced cigarettes account for nearly 90% of sales, contributing to accessibility and rising use, particularly among youth.

    Participants also highlighted the broader public health and economic impact, noting that tobacco use prevalence in Bangladesh stands at 35.3%, and that tobacco-related costs reached more than double industry revenue, and called for stronger pricing policies and alternative employment options for bidi workers as part of broader tobacco control efforts.

    Concurrently, bidi workers called for higher wages and the removal of taxes on the sector during a May Day rally organized by the Bangladesh Bidi Sramik Federation in front of the National Press Club. Workers demanded the withdrawal of taxes on the bidi industry, the elimination of advance income tax on bidis and cigarettes, improved wages, ration support, and action against counterfeit products. Union representatives also raised concerns about industry conditions and alleged financial outflows by multinational companies, while emphasizing the need for policy changes to support workers in the bidi sector.

  • Vietnam Eyes Illicit Market as it Introduces Mixed Tobacco Tax  

    Vietnam Eyes Illicit Market as it Introduces Mixed Tobacco Tax  

    Vietnam’s planned introduction of a mixed tobacco excise tax from 2027 is expected to combine a 75% ad valorem rate with a gradually increasing specific tax, adding 2,000 VND ($0.08) per pack annually and reaching 10,000 VND ($0.38) by 2031. The policy aims to reduce smoking rates, increase the tax share of retail prices to nearly 60%, and boost excise revenue, which is projected to more than double to 39.1 trillion VND ($1.5 billion) by 2030. However, officials and experts warn that higher taxes could widen price gaps and push some consumers toward illicit tobacco, which already accounts for an estimated 20–22% of the market and causes annual tax losses of up to 6 trillion VND ($228 million).

    Authorities say stronger enforcement will be critical to support the policy, including higher penalties for smuggling and retail violations, expanded oversight of e-commerce sales, and coordinated action among customs, police, and border forces. Recent enforcement efforts have resulted in over 23 million packs of illicit cigarettes seized and more than 1,600 violations recorded, though officials note that trafficking remains widespread and increasingly sophisticated across multiple regions.

  • Report: New 15% Tobacco Tax One of Five Streams EU Considering  

    Report: New 15% Tobacco Tax One of Five Streams EU Considering  

    Reuters reported that the European Union is discussing five new revenue streams that would help fund its seven-year budget, allowing for new priorities like defense ​and competitiveness and service joint debt, while limiting cuts to agriculture and regional aid.

    The proposed streams for 2028-2034 are an emissions trading system, a carbon border adjustment mechanism levy, a non-collected electronic ⁠waste tax, a corporate ​resource for ⁠Europe levy, and a tobacco excise duty. The tobacco tax would be a new 15% uniform call-rate tobacco duty, paid by EU member states from national budgets, which would bring in an estimated €11.2 billion ​a year, the ​Commission says.

    By a vote of 370-201, EU’s parliament voted to increase its budget 1.26%, increasing total spending to about €1.94 trillion.

  • Indonesia’s Tax Strategy Not Impacting Smoking Rates

    Indonesia’s Tax Strategy Not Impacting Smoking Rates

    Indonesia’s long-running reliance on tobacco excise increases has failed to significantly curb smoking, according to a National Health Survey, with around 70 million people still using tobacco and prevalence remaining among the highest globally. Despite a 23% tax increase in 2020 and steady annual rises since, cigarette affordability has remained largely unchanged, as income growth has offset price increases, leaving consumers spending roughly the same share of income on cigarettes over the past decade.

    Analysts say structural issues are undermining the effectiveness of tax policy, particularly wide price disparities across product categories. Lower-taxed hand-rolled kretek cigarettes continue to provide a cheaper alternative, encouraging smokers to downtrade rather than quit. This dynamic has limited the impact of higher taxes on overall consumption.

    Health economists argue that without more aggressive and harmonized tax reforms, excise policy alone will continue to fall short as a deterrent. The findings underscore broader challenges for tobacco control strategies in emerging markets, where affordability and product substitution can blunt the intended impact of fiscal measures.

  • Ugandan CSOs Want Higher Taxes to Push Already Declining Smoking Rate

    Ugandan CSOs Want Higher Taxes to Push Already Declining Smoking Rate

    Several civil society organizations (CSO) in Uganda have asked the Ministry of Finance to increase the tax on imported tobacco products to 75%, according to New Vision. Mengo Talibita, a representative of the Tobacco Control Committee, said current excise taxes are often in the 31% to 35% range, “leaving cigarettes relatively affordable.”  

    Uganda’s Tobacco Control Act of 2015 introduced 100% smoke-free public spaces, banned shisha and e-cigarettes, prohibited tobacco advertising, required 65% graphic warnings on packaging, raised the smoking age to 21, and added restrictions to where tobacco products could be sold. Since then, the country’s modest smoking rate decreased from 7.9% to 6.7%.

    Talibita said the tobacco industry tries to manipulate government policy during the tax cycle, and Minister of State for Finance, Planning and Economic Development, Henry Musasizi said the department is under heavy pressure from the CSOs to increase the tax rates. In an interview with New Vision, one smoker who declined to be named said, “Much as the law was put in place, there were no gazette places for smokers. Apparently, when one wants to smoke, it is hell one gets [with] insults from the public.

    “We need to be given freedom as smokers. Let the government put in place what was agreed for us.”

  • Latvia Continues Plan of Raising Tobacco Taxes

    Latvia Continues Plan of Raising Tobacco Taxes

    Latvia has seen a dramatic rise in cigarette prices over the past decade, with the excise tax on popular brands like Winston doubling since 2017. According to an analysis by Latvian Television’s investigative program “Aizliegtais paņēmiens”, excise revenue from tobacco grew 53% between 2017 and 2025, reaching €291 million last year. The price of a pack of Winston cigarettes increased from €3 in 2017 to around €5.40 in 2025, with taxes now making up roughly 81% of the retail price. Planned further excise increases of 15% in both 2027 and 2028 could push prices near €8 per pack.

    While higher excise duties have boosted government revenue, they have also raised concerns about the growth of the illegal tobacco market, as retail sales volumes fell approximately 22% over the same period. Tobacco is not domestically produced in Latvia, presenting fewer variables for authorities to weigh when considering excise policy.

  • DoF Says Illicits Threaten Philippines Fiscal Stability

    DoF Says Illicits Threaten Philippines Fiscal Stability

    Philippine finance officials are raising alarms over the growing impact of illicit cigarette trade, warning that smuggling is driving down tobacco excise tax revenues and threatening funding for public health programs. The Department of Finance (DoF) said tobacco tax collections fell 24% from P174.6 billion ($3 billion) in 2021 to P132.3 billion ($2.2 billion) in 2024, despite rising smoking rates, with Finance officials describing illegal tobacco as a direct threat to fiscal stability and healthcare financing.

    Officials estimate the government may have lost up to P172 billion ($2.9 billion) in tobacco excise revenue between 2020 and 2025 due to smuggling, with illegal cigarettes accounting for roughly 20% of the market. Lawmakers and industry representatives said the price gap between legal packs, which sell for P125 to P200 ($2.13 to $3.40), and illicit packs priced as low as P30 ($0.51) is fueling demand, while also pointing to regulatory loopholes and misdeclaration of products as factors worsening the problem. Authorities are now considering measures including harmonizing vape tax rates, introducing minimum retail pricing, and strengthening coordination between regulatory agencies to curb illegal sales.

  • Michigan Gov Proposes Major Tobacco Tax Hikes

    Michigan Gov Proposes Major Tobacco Tax Hikes

    Michigan Gov. Gretchen Whitmer’s 2026–27 budget proposal includes new and increased taxes on nicotine and tobacco products, imposing a 57% wholesale tax on vaping products and nicotine pouches, raising the tax on other tobacco products from 32% to 57%, and increasing the cigarette tax from $2 to $3 per pack. The measures are projected to generate about $232 million in additional annual revenue to support Medicaid, smoking cessation, and cancer prevention programs, and will be debated by state lawmakers in early 2026.

  • FAIFA: Tax Hike Will Harm Millions of Indian Tobacco Farmers

    FAIFA: Tax Hike Will Harm Millions of Indian Tobacco Farmers

    A new report by the Federation of All India Farmer Associations (FAIFA), developed with Artha Arbitrage Consulting LLP, warns that India’s revised tobacco tax regime, which took effect Feb. 1, could significantly disrupt the country’s flue-cured Virginia (FCV) tobacco sector. The policy reintroduced central excise duties on cigarettes and raised the GST rate on tobacco products to 40% while removing the GST compensation cess, increasing the overall tax burden. The report estimates the changes could reduce FCV crop offtake by nearly 20% and eliminate approximately 2.6 million man-days of employment across farming and related supply chain activities. It also projects illicit cigarette consumption could rise by roughly 39%, potentially exceeding 46 billion sticks, as higher prices shift demand toward unregulated products, while ongoing tax disparities between FCV-based products and other tobacco categories continue to contribute to declining FCV acreage and grower participation.

  • Illinois Weighs New Restrictions on Remote Tobacco Sales

    Illinois Weighs New Restrictions on Remote Tobacco Sales

    Illinois lawmakers are considering legislation that would significantly tighten the regulation of remote tobacco and nicotine sales into the state. H.B. 4250 would amend the Tobacco Products Tax Act of 1995 to require any remote retail seller — including out-of-state companies — to obtain a state license before selling tobacco products to Illinois retailers or consumers, with implementation targeted for July 1, 2026.

    If enacted, H.B. 4250 would also impose a 45% tax on the wholesale price of tobacco products sold remotely, capturing online and mail-order transactions that policymakers argue have escaped traditional enforcement. The proposal reflects Illinois’ broader push to close regulatory gaps around e-commerce, following recent actions restricting direct-to-consumer shipments of vaping products and expanding tobacco controls.