Tobacco prices may see a 15 rise due to excise tax

It is a fact that that excise taxes will increase, but no one knows whether the change will result in a 5 or 15 percent rise when it comes to tobacco prices – Napi Gazdaság published in its Monday issue.

EU is holding Central and Eastern European nations up to stricter fiscal standards than it did with wealthier nations who joined the Union in the past. Right now, the EU demands that some nations hike their tobacco taxes five-fold in a short three to five-year transition period; this requirement is unfair to the prospective members and unwise for the current EU-15. As a matter of fact, long-term result of strictly enforcing this tax rate requirement will be resentment of the EU's powers. The more immediate result will be rampant smuggling of cigarettes into the new member states – smuggling that will hurt tax collections.