Cigarette prices have increased by an average of 50 tetri (about $0.19/€0.16) in Georgia following amendments to the Tax Code that came into play on January 1, providing for an increase of ad valorem tax on cigarettes from 10% to 30%.
Also from January 1, 2019, the excise tax on tobacco became equal to filtered and non-filtered cigarette and totaled 1.70 tetri (about $0.63/€0.56) per 20 cigarettes.
Before, the excise tax on non-filtered cigarette was 60 tetri (about $0.22/€0.20).
The cost of a pack of Winston cigarettes has risen from 4.30 GEL (about $1.61/€1.41) to 4.80 GEL (about $1.80/€1.57), the price of Camels increased from 4.00 GEL (about $1.50/€1.31) to 4.50 GEL (about $1.68/€1.47) and Magna from 3.70 GEL (about $1.38/€1.21) to 4.20 (about $1.57/€1.37)GEL.
While importer companies warn about the high risks of illegal business and contraband, the supporters of the Tax Code amendments claim that the increase of the excise tax on tobacco would reduce the number of smokers.
Akaki Zoidze, the head of the Parliament’s Health Committee from the Georgian Dream party, also says that one of the main goals of increasing the excise tax on tobacco is to encourage smokers to quit smoking.
He said that making the excise tax equal for filtered and non-filtered cigarette was an obligation taken on by Georgia from the European Union.
Zoidze explained that Georgia’s obligation is an excise tax on one pack of cigarette to be €1.80 by 2024.
The World Health Ogranization has certain calculations to save the lives of 35,000 people from early death over the next 15 years and [give] the country’s economy with 2.2 billion GEL (about $0.82billion/€0.72 billion)”, said Zoidze.
He said there is no risk of contraband as currently the market accounts for less than one per cent of tobacco products.