Tobacco.org

• UPDATE: EU Countries Reach Deal On Tobacco Tax  

European Union countries Tuesday agreed to raise taxes on tobacco products sold in the bloc, in a bid to protect public health and boost government revenue.

Under the deal, starting in 2014, the minimum tax will be raised to 90 euros ($134.8) per 1,000 cigarettes, and no lower than 60% of their sales price. The current minimum rate is 64 euros per 1,000 cigarettes and no lower than 57% of the sales price.

EU countries have different tax rates on cigarettes and other tobacco products since many countries impose taxes higher than the bloc's minimum rate. Eastern European countries that joined the bloc in 2004 generally have lower rates than older EU members.

EU countries that don't yet tax tobacco at the minimum rate, or have only recently raised rates to this level, will have until 2018 to comply with the new tax level.

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• Closing the tobacco loopholes 

EU finance ministers will next week (11 November) try to agree an increase in the minimum rates of excise duty on cigarettes and other tobacco products.

The proposal under discussion would raise the minimum excise rate to €90 per 1,000 cigarettes, compared to €64 today. The legislation would also close loopholes that have allowed companies to market cigarettes as cigars and cigarillos, and some fine-cut tobacco as pipe tobacco. Tobacco companies have exploited these loopholes to benefit from lower tax rates applied to those products. . . .

It said that these variations were a stimulus to illegal cross-border trade, as it was often cheaper for people to buy cigarettes that had been smuggled in from other EU countries than to buy those legally for sale. The Commission said that this trade undermined government attempts to

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• Operation ‘Samhna’ : Potentially the largest seizure of cigarettes ever 

A multi agency operation, code named ‘Samhna’, headed up by Revenue’s Customs Service, is currently underway in Greenore Port, Co Louth, and surrounding area.

The operation, targeting the suspected criminal activities of an organised crime group operating both north and south of the border, involved the surveillance of a general cargo vessel M/V Anne Scan, which sailed from the Philippines on 15/09/2009 for Greenore Port, arriving at approximately 0600 hours on Monday, 26/10/2009, carrying a cargo declared as ‘animal feed’. Officers kept the vessel under surveillance, as they suspected that a large consignment of contraband cigarettes was concealed within the cargo.

Following the discharge of part of the cargo from the vessel earlier this morning onto awaiting trucks, which were allowed onwards to the importer’s premises, the multi agency task force, involving Officers of Revenues Customs Service and An Garda Siochana, moved in and raided several premises in the Co. Louth area, in addition to mounting an operation on the vessel itself. A large consignment of contraband cigarettes has been confirmed, estimated to be in excess of 120m cigarettes with a retail value of about €50m and a potential revenue at risk of approximately €40m. Several persons have been arrested at various locations by the Gardai for questioning.

The operation in the Republic of Ireland involved Officers of Revenue’s Customs Service, An Garda Siochana, The Criminal Assets Bureau, the Irish Naval Service and Air Corps and in Northern Ireland, Officers of HM Revenue & Customs and the PSNI. In addition the European Anti-Fraud Office (OLAF), which was also involved, will co-ordinate the international enquiries which will form part of the follow-up investigations. It is estimated that in excess of 150 Officers from the various Agencies participated in the field in today’s operation.

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• EU ruling 'will spark cigarette price war'  

A NEW court ruling could spark a price war on cigarettes in Ireland with disastrous effects for people's health, anti-smoking group Ash Ireland has warned.

The European Court of Justice yesterday declared that Ireland cannot set minimum prices for tobacco because it distorts competition and benefits manufacturers.

Although this is an interim opinion, it could open the way for cigarette sellers to start discounting heavily on price, which could lead to more young people taking up the habit and reducing the incentive to quit, said Dr Angie Brown of Ash.

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• Cigarette pricing rule a 'risk' to free competition 

THE POLICY of setting a minimum price on tobacco products distorts competition, a preliminary opinion to Europe's highest court has said.

The imposition by the Government of binding prices restricts manufacturers' freedom to set prices, thereby posing a risk to free competition, according to Juliane Kokott, advocate general of the European Court of Justice.

The opinion of the advocate general is not a final judgment, although the court, to follow next March, follows it in the vast majority of cases. Costs in the case were awarded against Ireland.

The Department of Health said it was examining the opinion. "This opinion is at an intermediate stage in the process and the judgment of the court is still awaited," a spokeswoman said.

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• Cigarettes On Sale On The Internet: ESC Press Statement 

The European Society of Cardiology wishes to comment on media reports this week that France is preparing to authorise the sale of cigarettes on the internet, to conform to European rights. Although Budget Minister Eric Woerth denies that this is the intention, the news is disappointing given the drop in heart attack rates following last year's smoking ban.

ESC spokesperson Professeur Ph.Gabriel STEG (Universit� Paris VII, Centre Hospitalier Bichat-Claude Bernard, Paris) said :

"While I understand that the alleged motive is that the French government needs to align itself with the European directive and the need to tackle the monopoly of cigarette retail in France, this move contradicts years of health policy to reduce tobacco consumption.

There is clear evidence that an increase in tobacco retail price and restricted access to cigarettes have led to less people smoking, with important health benefits. The government needs to take action to continue its previous policy which tackled smoking as an effective way to improve public health."

Daily financial newpaper Les Echos broke the news on 14 October, stating that the French government would propose the idea to Parliament in mid-November.

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• Le tabac en vente libre sur Internet ? [Tobacco counter on the Internet? ] 

GOOGLE TRANSLATION:

At the time of the fight against tobacco use is increasing (increase of 10% next tobacco endorsement under shock images on cigarette packs), a new provision could face a paradox. Thus, reveal Les Echos, under the transposition of a European directive on excise duties (indirect taxes) levied on tobacco and alcohol, cigarette sales should be possible on the Internet "by 1 April 2010 ".

The daily quoted the ministry's budget, that "the conditions of application of the Directive are far from being arbitrated. "But, adds the journalist, it does not seem possible to put the spirit in question. "The information Voices has led to an immediate denial from the ministry. "The sale of tobacco through the Internet is not permitted in France," says a press release stating that "it is not intended to authorize soon.

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• Government ban on cigarette displays in shops may fail legal test, QC tells trade  

A flagship government anti-smoking scheme that would ban Britain's shops from displaying cigarettes would be "unenforceable", according to one of the country's leading QCs.

The plan to prevent shops from selling tobacco products unless they are kept entirely out of sight of customers is due to be debated and voted on by MPs today.

With critics saying that the proposal threatens to drive thousands of small corner shops out of business, a backbench rebellion is expected, with as many as one in ten Labour MPs set to vote against the scheme, which is backed by the Government.

However, in advice drawn up for the Tobacco Manufacturers' Association (TMA), Lord Pannick, QC, has raised the prospect of a legal challenge. In his advice, he claims that even if the legislation was passed, it would not carry any legal weight because the Government has failed to give proper notification of its intentions to the European Commission before placing the Bill before Parliament.

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• Burning money 

UP IN SMOKE: Contraband cigarettes are incinerated in Montenegro in 2007. Bulgarian tobacco interests allege that reported plans to send cigarette excises soaring from 2010 will push business towards the illegal market.

Bulgaria, which has the second-highest rate of smoking in the European Union, is said to be set to make smokers cough up about 30 per cent more for cigarettes in 2010 - bringing forward by a year increased excises to EU levels in a move designed to help state coffers through increased revenue and decreased health costs.

Finance Minister Simeon Dyankov has confirmed that excises on tobacco products will go up, although with the 2010 Budget not yet finalised, there is no official confirmation yet of the precise price hikes.

Media reports of the planned move brought an outcry from tobacco interests who said that it would worsen Bulgaria's already considerable cigarette smuggling problem and drive the country's tobacco products giant Bulgartabak to bankruptcy. , , ,

Bulgaria's northern neighbour and fellow EU member Romania has taken the route of increased excises - twice in 2009 - on the way to matching EU levels in 2010. Lithuania also has twice raised excises in 2009, pushing cigarette prices up by close to 50 per cent in a year.

A sole reversal of the trend was in Croatia

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• Cigarette branding 'misleading' 

Subtle branding on cigarette packets is misleading smokers into believing some products are less harmful than others, research suggests.

Products branded "smooth", "silver" or "gold" are generally believed to be healthier and easier to give up, a survey of1,300 people found.

But when shown plain packs the false beliefs disappeared, University of Nottingham researchers discovered.

EU rules ban any claims that some cigarettes are safer than others. . . .

The results from 800 adult smokers and 500 teenagers, all in the UK, also showed that lighter-coloured packaging led people to believe the cigarettes had a lower tar content or were generally less harmful. . . .

Professor David Hammond, from the Department of Health Studies and Gerontology at the University of Waterloo in Ontario, Canada, said: "The truth is that all cigarettes are equally hazardous, regardless of what colour the pack is or what words appear on it.

"These tactics are giving consumers a false sense of reassurance that simply does not exist."

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• Smoke No Longer Found In European Hospitals 

Tobacco use is prohibited in hospitals in many European countries, although levels of compliance with this regulation differ. A study carried out by researchers from the Catalan Institute of Oncology (ICO) has shown for the first time that exposure to environmental tobacco smoke in European hospitals is "low", and "without any notable differences" between them.

Europe wants to see smoking in all closed public places banned by 2012. However, to date only 10 European countries Spain is not among them are applying this regulation comprehensively. Now a research study has described the levels of environmental tobacco smoke in European hospitals and has shown for the first time that exposure is "low" and "without any notable differences between them".

The study, carried out in 2001 in 30 hospitals throughout seven European countries (Germany, Austria, Belgium, France, Greece, Romania and Spain) measured levels of particulates with a diameter of 2.5 micros (known as PM2.5) (μg/m3) or below, which indicate the presence of environmental tobacco smoke, at six standard sites in each hospital.

Esteve Fern�ndez, lead author of the study and a researcher at the ICO, tells SINC "it is important to measure compliance with laws by regularly measuring levels of environmental tobacco smoke". To do this, the experts suggest that national and European regulations to control tobacco addiction should ban smoking in health establishments without any exceptions.

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• Revealed: £2bn cost to UK from cigarette smuggling  

At the Ukrainian-Polish border town of Przemysl, the seizure of 4,500 cigarettes hardly solicits a reaction. The border guards know the discovery will barely impact on one of Europe's fastest-growing forms of organised crime.

For criminal gangs from the Mafia to the Triads, cigarette smuggling is the new cash cow, and governments, companies and taxpayers are suffering the consequences.

Europe's growing addiction to cigarette smuggling is burning a £7bn hole in the pockets of governments in western Europe through lost tax revenues, and leaving companies including UK-listed British American Tobacco (BAT) and Imperial Tobacco nursing some £600m in lost sales each year.

While the problem starts in many of the former Soviet-bloc countries and other parts of the developing world, the effects are being felt on streets across the UK.

The illegal import of cigarettes that are either produced in counterfeit factories or legally purchased in low tax jurisdictions and smuggled into Britain is growing by the day and tobacco industry insiders question how it will ever be stopped.

Criminal gangs are using increasingly creative means to flood Britain with smuggled packs of Marlboro, Superkings or Lambert & Butler, or eastern European brands such as Classics or Jin Ling.

This month it emerged that children in the north east of England are being recruited to act as mules on smuggling missions. Seduced by the offer of cut-price air tickets and spending money, teenagers are flying to low-duty countries to fill their suitcases with cigarettes, returning to Britain to pass them on to criminal gangs.

Four schoolgirls aged 15 and 16 who live near Durham narrowly avoided jail after being caught smuggling 200,000 cigarettes into Britain. . . .

As the recession rocks the UK, demand for low-cost cigarettes is growing, driven by the dominant view that this is a victimless crime. However, tobacco industry insiders and customs officials suggest it is anything but. . . .

Cigarette companies have received some of the blame, with critics arguing that the "Big 4" – Philip Morris, Japan Tobacco, BAT and Imperial – over-produce in Ukraine, knowing their products will be smuggled elsewhere. Philip Morris and Japan Tobacco agreed in 2004 to pay a combined $1.65bn (£1bn) to the European Union and member states amid allegations they were involved in smuggling. However, recent signs suggest the cigarette manufacturers are now taking a different approach.

Poland's smuggling problem dates back to 2004 when the country joined the EU, since when the government has been raising tobacco duty levels to meet EU targets – twice this year alone.

However, higher duties in Poland have only heightened the disparity with taxes and tobacco sale prices in neighbouring countries such as Ukraine and Russia. . . .

"Once the line opens, the situation will get worse. Then you will see not only cigarettes but counterfeit handbags, medical products and clothing," he warns.

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• Cigarette smuggling ‘epidemic’  

CIGARETTE smuggling is costing the state hundreds of millions of euro in lost levies.

The illegal trade is reaching epidemic proportions and one estimate, for the losses to the exchequer per year by the end of 2010 of excise duties and VAT, has been put at €750 million.

The claim was made yesterday by the Irish Tobacco Manufacturers Advisory Committee (ITMAC). It represents the big three cigarette companies – Gallaher, Players and Carrolls.

ITMAC says the loss of much-needed revenue in times of recession was being fuelled by the lenient penalties and the huge profits smugglers can make and it says the issue needed to be addressed.

With a counter price of €8.45, Ireland has the highest average cost for a packet of 20 cigarettes in the EU.

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• Ukraine’s ‘Lost’ Cigarettes Flood Europe 

garettes -- at $1.05 per pack -- making the country a bonanza for smugglers, whether by glider or more mundane pathways on the ground. Cars and trucks filled with Ukrainian-made Marlboros and Viceroys get waved through border checkpoints by customs guards who seem more than eager to accommodate, for a price. Loads also move by bus and train, bound for other European countries where high taxes make packs cost as much as $5 (Germany) or $10 (United Kingdom).

The backbone of this underground commerce -- the acquisition of the cigarettes themselves -- is by far the easiest part of the entire operation. The world's four leading multinational tobacco companies, Philip Morris International, Japan Tobacco International (JTI), Imperial Tobacco, and British American Tobacco (BAT), have produced billions of excess cigarettes in Ukraine, fueling a teeming black market that reaches across the European Union. Today, Ukraine is rivaled only by Russia as the top source of non-counterfeit brand cigarettes smuggled to Europe, EU officials say.

The booming trade in tobacco smuggling has major consequences, say industry experts. The growing traffic pushes huge supplies of cheap, untaxed, and unregulated cigarettes into the rest of Europe, undercutting otherwise successful attempts to curtail smoking. Worse, officials say, the trade is boosting organized crime gangs, who find the soft penalties and big profits hard to resist. . . .

Attracted by high smoking rates and the potential for rapid returns on investments, multinational tobacco companies rushed to acquire the state-run cigarette factories after the Soviet regime collapsed in 1991. Today, the big four tobacco companies -- Philip Morris, BAT, JTI, and Imperial -- control 99 percent of the Ukrainian cigarette market.

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• EU health chief proposes stricter laws on smoking 

The European Union's health chief proposed on Tuesday that uniform laws be drafted for all 27 countries in the bloc to regulate smoking more strictly in public areas and workplaces.

Many EU countries have laws limiting exposure to second-hand, or passive, smoking. The rules are strictest in Britain and Ireland, where smoking is banned in enclosed public places, public transport and workplaces, including restaurants and bars.

"Each and every European should be entitled to full protection from tobacco smoke," EU Health Commissioner Androulla Vassiliou told a news conference.

The recommendation calls on all member states to implement laws that will limit exposure to tobacco smoke in public places, workplaces and public transport, and aims to protect children.

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