Smokers' group: High taxation on cigarettes 'not working'

The Government should cut the price of a packet of cigarettes by €1 in next month’s budget, say campaigners.

The smokers’ group Forest Eireann has said the move would reduce smuggling and boost both the retail trade and household finances without impacting on public health or government revenues.

Spokesman John Mallon said that since 2005 smoking rates in Ireland have increased and revenues have remained flat, despite a near doubling of tobacco duty.

The reason, says Forest Eireann, is a significant increase in smuggled cigarettes.

Mr Mallon said: "A reduction in tobacco duty of one euro will have no adverse impact on revenue or public health. It would reduce smuggling and help small shopkeepers and household finances, providing a much needed tonic to the economy."

Forest Eireann has reminded the Finance Minister of a 2011 report by the Revenue Commissioners that said: "It is quite likely that price increases cause consumption of taxed cigarettes to decrease and the consumption of untaxed cigarettes to increase".

Price rises, said Mallon, have not reduced smoking rates.

He said: "Since 2002 the retail price of a pack of twenty cigarettes has nearly doubled. Since 2005, when the Office of Tobacco Control declared that the smoking rate had fallen to 23.5% of the population, it has risen to at least 29%. High taxation isn’t working."

According to Forest Eireann the impact of smuggling is encouraging crime and harming legitimate retailers. It is also exposing children to on-street tobacco sales, and smokers in general to counterfeit products.

Mallon said: "From a consumer’s point of view, the choice is to buy the legal product for €9 or a no-questions-asked product for less than half that. People are voting with their wallets and a further tax increase will only accelerate this behaviour."