site.btaParliament Adopts Greater Increase of Expensive Cigarettes as of 2016

Parliament Adopts Greater Increase of Expensive Cigarettes as of 2016

Sofia, November 12 (BTA) - The National Assembly Thursday adopted second-reading amendments to the Excise Duties and Tax Warehouses Act that introduce changes in the excise tax calendar of cigarettes. Next year the cheapest cigarettes will appreciate by 0.30 leva while the price of more expensive ones will increase more significantly.

In 2016, the specific excise on cigarettes will be reduced from 101 to 70 leva per 1,000 cigarettes. The ad valorem excise will be increased by 38 per cent of the selling price in 2016, by 40 per cent in 2017 and by 42 per cent in 2018, the MPs decided.

The Reformist Bloc, BSP-Left Bulgaria and the Patriotic Front objected to the changes in the excise tax calendar and demanded that this paragraph be removed from the draft amendments. The changes were adopted with the votes of GERB, the Movement for Rights and Freedoms, the Bulgarian Democratic Centre and ABV.

Budget and Finance Committee Chair Menda Stoyanova of GERB explained that next year the prices of the cheapest cigarettes (between 4.20 and 4.70 leva) will increase by 0.30 leva and the tax burden will be carried by the more expensive ones. Those which cost between 5.25 and 5.90 leva per pack will appreciate by 0.25 leva instead of 0.15 leva, and cigarettes which cost between 5.90 and 6.50 leva will appreciate by 0.55 leva instead of 0.20 leva. Stoyanova also said that the change will guarantee more revenues in the national budget: 119 million leva in the next three years.

Korneliya Ninova of BSP-Left Bulgaria warned that the excise duty's increase leads to growth of the grey sector and not to an improvement of the nation's health.

Stoyanova replied that the increase of the cigarettes' prices does not depend on the will of any government because it is an implementation of Bulgaria's commitment to reach the EU's minimum excise duty on cigarettes by 2018.

Patriotic Front Co-Floor Leader Valeri Simeonov said he cannot accept that the excise tax calendar needs changing once every 10 to 12 months. In his words, the role of the excise duty is to limit unhealthy habits.