TL 1.9B to be added to budget by raised cigarette prices

Tobacco companies increased the tobacco prices yesterday in response to the tax increase which came into effect on the first day of the New Year. Philip Morris, JTI and BAT announced their tobacco's newly-increased prices. Except a few companies, many increased their priced by TL 0.50. Thus, the cheapest cigarette on the market became TL 5, while the most expensive is now TL 10.5. The Turkish Finance Ministry will make the highest profit from the increased tobacco prices. With the most recent increase, tax rate on tobacco rose from 82 percent to 83 percent. TL 0.40 out of the new increase of TL 0.50 will go to the Ministry of Finance as tax, and the ministry will collect nearly TL 1.9 billion with the new tax, based on the fact that 4.7 billion boxes of cigarette were sold in 2014.

Smuggled cigarettes have increased by one million

Border security officers caught 2.15 million in 2013, and 3.16 million boxes of smuggled cigarettes in 2014. Increasing tobacco prices is part of the measures taken against tobacco products in Turkey, and on the one hand, smugglers have turned the price increases into an opportunity. Security officers, on the other hand, are successfully fighting against smugglers.

At the Ministry of Interior, Efkan Ala said that "3.16 million boxes of smuggled cigarettes valued at TL 1.22 billion were apprehended in 2014." Moreover, Associate Dr. Zeynep Önder at Bilkent University stated in her study "Price and Taxation Policy in Tobacco," that "increasing cigarette prices due to the increasing taxes have caused a serious decrease in smoking. A 10-percent increase in prices in developed countries leads to a 2.5 to 5 percent decrease in smoking."

CONTRIBUTED BY UĞUR BECERİKLİ