Expect Higher Tax On Cigarettes In Japan

In Japan, a box of Marlboro Lights costs just around 320 yen, compared with 600 yen to 800 yen in the European Union. Prime Minister Yukio Hatoyama told reporters on Friday that a hike in the tobacco tax is ''possible'' considering the adverse effects of smoking on public health and the environment. Even The Wall Street Journal paid attention:

Japan's new administration is considering raising cigarette taxes to European levels to help pay for an ambitious domestic spending plan, in a potential threat to partially state-owned Japan Tobacco Inc.

Japan Tobacco, which sells the Mild Seven, Camel and Salem brands, has a 65% market share in Japan. Tonight, TV7 provided the following figures for the tax part on the cost of a pack of fags around the world:

1,186 Yen (731 Yen tax)
829 Yen (491 Yen tax)
644 Yen (385 Yen tax)
300 Yen (174 Yen tax)

In other words, tax revenue on cigarettes is still much lower in Japan than in other countries. The Ministry of Health, Labour and Welfare last week asked the government's tax panel to increase the tobacco tax by 10 yen per cigarette which would push up the price. But in October last year, JT enlisted customers "in a campaign to stop the government from raising cigarette taxes, " according to Blomberg:

Consumers opposed to the proposal to increase retail cigarette prices by as much as threefold should fill in a petition at tobacco retailers, by mobile phone or on the Internet, the Tokyo-based company, which is 50 percent owned by the government, said..."

Seems odd, but a lot has changed since then. If you smoke, Japan's new government just may want you to pay a little bit more for that pleasure. I think I will label that as "progress."


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