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Tobacco tax passes after bumpy ride

The government on Wednesday saw its controversial bill to raise the tobacco duty by 41.5 percent (or HK$0.50 a cigarette) pass through third reading in the Legislative Council after heated debate.

Thirty-three voted for, 8 against the bill, with 12 abstentions.

The major supporting votes came from the Democratic Party and the Civic Party.

Pro-establishment parties – Democratic Alliance for the Betterment and Progress of Hong Kong (DAB) and Hong Kong Federation of Trade Unions – abstained from voting.

This increase came after a massive 50 percent rise in tobacco duty in 2009.

The tobacco duty took effect by virtue of a public revenue protection order on Feb 23, the same day when the tax increase was announced.

Had the tax increase been vetoed, the government would have had to refund to cigarette importers and distributors.

Defending the government’s case, Secretary for Food and Health York Chow said the purpose of the tobacco duty increase was to protect public health.

Apart from tax the increase, Chow said the government will increase tobacco control, enhance rehabilitation services and public education to encourage people, especially young people, to smoke less or quit smoking.

The government will subsidize agencies to run for rehabilitation services, while the Hospital Authority will also provide drugs for rehabilitation for free, he said.

Despite the current tax increase, tax only constitutes 70 percent of the cigarette price, which is still a distance from 75 percent advised by the World Health Organization, he said.

Quoting government statistics, he said the number of young smokers decreased by 10 percent after the 2009 tax increase, while the demand for rehabilitation services was also on the rise.

Chow rejected the suggestion that tobacco duty increase would prompt smokers to buy illicit cigarettes, saying the government is determined to crack down on illicit cigarettes.

As to the proposal for a phased tax increase, he argued that a higher increase is a bigger incentive than a phased increase for smokers to smoke less or quit smoking.

DAB lawmaker Wong Ting-kwong, a smoker for over 40 years, said the tax increase will place a heavy financial burden on the poor smokers.

He also worried the tax increase may affect the livelihoods of over 30,000 newsstand operators.

Albert Chan from the People’s Power said elderly, low-income smokers will have financial difficulty buying cigarettes after the tax increase, slamming the government for neglecting the needs of the underprivileged.

But health services constituency lawmaker Joseph Lee Kok-long said the tax increase will help people to quit smoking.

China Daily

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