TaxPersonal TaxEC’s hand forced on single tobacco tax

EC's hand forced on single tobacco tax

The European Commission has admitted that it may be forced to introduce a transitional period for the introduction of a harmonised tobacco tax for countries joining the European Union.

This follows objection from EU candidate countries including the Czech Republic, Poland and Slovakia, claiming that ‘quick changes’ to excise duties would result in steep price increases and strengthen the anti-EU lobby.

Excise duties on cigarettes in these countries are 42%, substantially lower than the EU rate of 57%, and an immediate increase in the rate, would result in the price of a box of cigarettes rise by between 30% and over 110%.

An EC official told the Financial Times: ‘We want fair play in the internal market. But we also know we would be playing into the hands of anti-European voices if we do not grant transitional periods.’

Czech ambassador the EU, Libor Secka said his country was not opposed to tax harmonisation, but a sharp increase in cigarette prices would ‘turn public opinion against joining the European Union’.

Similarly, a Polish official said the less well-off could not afford more expensive cigarettes. He added: ‘The anti-EU parties will have a field day.’

Links

OLAF in European tobacco action

Related Articles

LITRG urges government to consider tax changes in disability work plan

Administration LITRG urges government to consider tax changes in disability work plan

1m Lucy Skoulding, Reporter
HMRC appeal rejected in Tottenham Hotspur case

Administration HMRC appeal rejected in Tottenham Hotspur case

2m Emma Smith, Managing Editor
HMRC urged to clarify impact of income allowances on Self-Assessments

Personal Tax HMRC urged to clarify impact of income allowances on Self-Assessments

3m Alia Shoaib, Reporter
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

3m Emma Rawson, ATT Technical Officer
Wealthy individuals could circumvent top tax rate rises

Personal Tax Wealthy individuals could circumvent top tax rate rises

5m Alia Shoaib, Reporter
Italy grants first successful non-dom status application to former UK non-dom

Personal Tax Italy grants first successful non-dom status application to former UK non-dom

6m Emma Smith, Managing Editor
Industry reaction: Taylor Review does not go far enough in addressing tax issues

Legal Industry reaction: Taylor Review does not go far enough in addressing tax issues

6m Alia Shoaib, Reporter
Does the Taylor Review sufficiently address the gig economy?

Corporate Tax Does the Taylor Review sufficiently address the gig economy?

6m Alia Shoaib, Reporter