Cigarettes: tax up, prices up, illicit trade up

Surging taxes and prices in Egypt have led to a steep increase in the country’s illicit trade in cigarettes, according to a story by Fatima El-Saadani for Business Today Egypt, relayed by the TMA.

Illicit CigarettesTrade

Illegal cigarettes

Egypt raised its cigarette tax in July 2010 by 84 per cent, which led to a 48 per cent increase in prices, and it raised its cigarette tax again in July 2011, this time by 37 per cent, which lifted prices by 21 per cent.

Excise tax currently accounts for 71 per cent of retail prices.

British American Tobacco‘s head of corporate affairs for North Africa, Karim Refaat, estimated that whereas the illicit trade in cigarettes accounted for 0.01 per cent of Egypt’s 81-billion-piece market during the first quarter of 2010, that figure had risen to seven per cent today and it could reach 10 per cent in the future.

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