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February 27th, 2009:

HK$10 Rise In Price Of A Packet Of Cigarettes

Smokers left gasping at HK$10 rise in price of a packet of cigarettes

BUDGET 2009 – SCMP – Bryony Taylor – Feb 27, 2009

Tobacco companies yesterday capitalised on the 50 per cent tax increase proposed in the budget by adding an extra HK$2 per pack onto the retail price.

Almost all brands increased by HK$10, rather than the HK$8 tax increase announced on Wednesday. Retailers 7-Eleven and Circle K said they were told by the suppliers to make the larger increase.

Philip Morris International estimated the increase in tax would mean an extra cost of HK$2,000 a year for a smoker who consumed 14 cigarettes a day.

However, this estimate does not take into account the extra HK$2 per pack, which adds a further HK$555 a year on average.

Despite this, lucky customers at Circle K stores continued to buy cigarettes at the old prices due to late publication of new price lists from suppliers. But some small vendors took advantage of the tax increase by putting up prices by HK$12 a pack.

“We have informed our trade partners that the price of most products must increase due to the significant tax increase and anticipated drop in the sale of duty-paid tobacco,” Philip Morris said.

Many anti-smoking groups were worried that the increase would be absorbed by the manufacturers, but this has not been case.

Philip Morris also expressed worries that the higher tax would provide business for illegal traders.

Anti-smoking campaigners deny this, however, and stressed the strength of Hong Kong’s customs department.

Cigars have also been affected by the increase, but due to their more complex pricing structure, new price lists have yet to be released.

“We are pleased that the tobacco companies are helping our cause by increasing the price further,” said Anthony Hedley, of the University of Hong Kong’s school of public health.

Li Cheong-lung, from the Committee on Youth Smoking Prevention, said: “Price influence is one of the most important reasons of youth smoking.

“Some youths have told me that they attempted smoking by purchasing lower-priced products, therefore the price increase could help stop newcomers.”

New prices

Marlboro HK$39; Kent HK$39; Salem HK$39; Next HK$34; L&M HK$36; Dunhill HK$39; Davidoff HK$35; Winfield HK$34; Capri HK$41; Winston HK$35

Tobacco Tax Rise Applauded

Feb 27, 2009 – SCMP

Hong Kong Cancer Fund applauds the government’s decision, announced in Wednesday’s budget, to increase the tobacco duty by 50 per cent.

Significant steps forward like this, combined with public awareness and tobacco control measures, can serve to minimise the burden of chronic illnesses such as cancer in our community.

As a charitable organisation providing free information and cancer support to more than 23,000 individuals diagnosed with cancer each year, we are pleased that Hong Kong’s policymakers are setting new parameters that will help us to control cancer.

Sally Lo, chairwoman, Hong Kong Cancer Fund