Jump to full article: Hong Kong Standard (hk), 2010-01-25
Author: Nicole Idanna Alpert is research associate with the Lion Rock Institute, a free-market think-tank
Intro: The 50 percent tax hike last February increased the cost of a pack of cigarettes and smokers, like most savvy consumers looking for a deal, are finding cheaper packs can be bought on the black market.
The poorest class is always the most vulnerable to fake products or drugs, and with knowledge that the tobacco hike is increasing black-market trade, is it responsible to keep the tax in place?
While some smokers may have quit since the hike, the overall effects have been negative on the whole for community health.
Recent reports show the illicit trade is growing, and strongly. The non-duty paid cigarettes have increased by 31 percent since the tax hike on tobacco, according to a study by the Tobacco Control Concern Group. . . .
But implementing such a stringent policy would tarnish Hong Kong's image, after all, the Nazi regime was the first to ban tobacco products. . . .
Should the government be raising tobacco tax when unsurprisingly it boosts black-market activity, which is difficult to control, that also endangers the youth, and results in loss of revenue for newspaper vendors. Others may accept that every planned policy or tax has its costs, but meanwhile, much greater damage to our community goes ignored.
Increasing the tobacco tax blindly and infinitely has caused unintended negative consequences that outsize the benefit the government intended.
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