Tobacco.org

Vice tax might overturn inflation prognosis 

The introduction of the vice tax might add to the inflationary pressure, says Central Bank Governor Mugur Isarescu (photo), who is concerned about this new development because tobacco accounts for a major share in the consumer’s basket. “I am concerned about this vice tax because I cannot help thinking how large a share cigarettes have in the consumption basket – half of the one for bared, for instance. It could really overturn our inflation target”, Isarescu said yesterday.

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EUR 140 M - Romanian cigarettes black market 

Bucharest- More than 10 per cent of the cigarettes on the market are smuggled and nearly eight per cent of the spirits marketed are counterfeits. This is what the representatives of the two industries stated at a press conference. The total cigarette sale figure exceeds 35 million pieces, the total value of the market being approximately EUR 1.4 Bln. Gilda Lazar, Corporate Affairs Director with JTI International, stated that tobacco companies pay taxes and charges of almost USD 1 Bln every year. Gilda Lazar also said that the price levelling trend for cigarettes is one of the factors that cause the smuggling, the majority of the goods that are smuggled into country being very cheap. The price rise caused by the entry into effect of the vice tax will only increase the share of counterfeits pr smuggled goods.

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Relatively stable Romanian tobacco market 

Paul Ogborn was appointed Managing Director of British American Tobacco Romania early this year. Paul Ogborn, 40, is an experienced manager and has worked for British American Tobacco for around 17 years in the UK, Nicaragua, Russia, Ireland, Poland and Germany.

Mr. Ogborn, you arrived in Romania in the first days of January this year in the middle of hard debate on the so called "tax on vice" which will be soon enforced. What are your comments on this issue?

My understanding of the Romanian market before arriving here was that it was relatively stable. The policy of excise seemed reasonable and, with one exception last year, the agreed time table for excise increases was being followed.

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Vice tax to boost cigarette prices 

The vice tax could boost the price of a cigarette pack by 37-38% while cigarette taxes could hike by 50-60% according to a study issued by Phillip Morris International. Huub Savelkouls, the company's director for Europe, said that the vice tax of 19 eurocents per pack will maintain the same parameters for all cigarette categories.

Savelkouls believes that introducing such a tax will increase by 60 percents the level of tobacco taxes.

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Romania: Taxes on Tobacco and Alcohol to Finance Public Health Care 

The Health Minister announced the enactment of taxes on tobacco and strong spirits consumption which will provide new sources to finance the Romanian public health care system, which has been affected by huge debts, ACT Media news agency reports.

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Cigarettes in Romania Twice Cheaper than in Bulgaria 

“A pack of cigarettes in Bulgaria costs EUR 2, while the average price of the same pack of cigarettes costs about EUR 1 here”, Romanian Minister of Public Finance Sebastian Vladescu said yesterday, cited by Adevarul newspaper. Vladescu pointed out that next year the excise value on tobacco products in Romania will increase and cigarette prices will respectively rise. “We are trying to figure out the most optimal way to increase prices of cigarettes and at the same time to decrease contraband”.

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Romania: Tobacco Manufacturer Gallaher Reports 12% Sales Increase in Romanian Market 

British tobacco manufacturer Gallaher announced its sales in the Romanian cigarette market grew by 12.6 percent in the first half-year, ACT Media news agency reports.

The increase was due to the good results registered by Ronson and St. George cigarette brands, according to ACT Media reports.

Gallaher began manufacturing in Romania in a production facility located in the former cigarette factory of another tobacco producer, Papastratos.

The Romanian factory now works at full capacity, registering "volumes that have grown gradually over the last period,"

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Cigarettes in Romania Twice Cheaper than in Bulgaria 

“A pack of cigarettes in Bulgaria costs EUR 2, while the average price of the same pack of cigarettes costs about EUR 1 here”, Romanian Minister of Public Finance Sebastian Vladescu said yesterday, cited by Adevarul newspaper. Vladescu pointed out that next year the excise value on tobacco products in Romania will increase and cigarette prices will respectively rise. “We are trying to figure out the most optimal way to increase prices of cigarettes and at the same time to decrease contraband”.

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Romania: BAT may transfer production units in the country 

British American Tobacco said that its operating companies in the UK and Ireland have announced that they are to initiate consultations on proposals to cease manufacture and transfer production in Eastern Europe. According to rumors the new operations will be located in Romania. . . .

In the UK, it is proposed that the Southampton factory will close within 18-24 months while in Ireland, P J Carroll & Co Ltd. is to consult on a proposal to stop manufacturing at its cigarette factory in Dundalk. . . .

The proposals would create combined restructuring charges of approximately £160 million, the majority of which, it is anticipated, would be charged in 2005.

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Tobacco advertising ? only on publications meant for the foreign market 

On Monday, the deputies decided the advertising of tobacco products is allowed in the publications that were not published or edited in Romania or in a state membership of the European Union and that are not mainly meant for the Romanian or community market.

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ROMANIA: Excises for Alcohol, Tobacco and Fuel to be Increased Starting With July 1st 

Excises for the main products submitted to this taxation regime will be increased starting with July 1st 2004, the most significant increases being for ethylic alcohol and fuel, stated sources form the Ministry of Public Finances. [This graph only]

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PwC to audit Romanian tobacco company 

PricewaterhouseCoopers will audit the privatization of the Romanian Tobacco Company (Tutunul Romanesc SNTR) following the request by the International Monetary Fund.

In mid-January 2004, the Privatization Authority sold 56.4% in SNTR to the consortium Tobacco 2003/EU for a total of 12 million. The price included the stake and pledged investments.

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ROMANIA: Gallaher Hopes For Romanian Cigarette Production 

British cigarette producer Gallaher, ranked sixth internationally and with sales worth 9 billion last year, is entering the Romanian market.

It is set to start production at a location in Bucharest.

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Romania To Ban Tobacco Ads 

The Ministry of Health in Romania announced that it drafted a bill that prohibits the advertisements of tobacco products. The bill will be enforced in July 2005, reported the Italian Agency ANSA. Since there are a great number of smokers in Romania, the suggestion caused disagreements and became an object of critics by the representatives of the tobacco industry

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Today's news: Romania may ban tobacco advertising in 2005 

Romania's Health Ministry has drafted a bill stipulating a ban on tobacco advertising.

The draft, subject to debate and approval by government and the two houses of parliament is more drastically even than similar those from the EU countries, because impose interdiction even on tobacco brands to be printed on various promotional objects.

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