Ministry of Finance: Excise Tax Not Related to Doubling the Price of Cigarettes

After the New Year, following the approval of a bill on increasing excise tax on cigarettes and alcohol on December 11th by the Parliament of Georgia, the prices of several types of cigarettes, namely Parliament, Marlboro, L&M and Chesterfield, has doubled or even tripled. The Georgian Finance Ministry says the excise tax increase has no connection with the increased price of cigarettes mentioned above.

The updated price of Parliament is 10 GEL, Marlboro - 8 GEL, L&M and Chesterfield - 5 GEL. These are produced by the company Philip Morris and the official distributed in Georgia by Omega Group. This, however, may change with GDM Co. Ltd moving in to take over the distribution.

Omega Group explains that raising the price of cigarettes produced by Philip Morris was a result of a deficit and due to which import was suspended. Therefore, the numbers are small and the demand is high. This, of course, reflected on prices. According to the company, everything will be clarified officially within a week.

The bill approved by Parliament involves increasing the tax by 0.20 Lari on filtered cigarettes, and by 0.05 Lari on non-filtered cigarettes.

The goal of the law is to tighten control on tobacco to better align Georgia with EU Directives. The World Health Organization demands maximum limitation on consumption of cigarettes, and an increase of excise tax is one of the measures towards achieving this.

Ana Akhalaia

06 January 2016 20:18