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Thanks to the “Mille Proroghe” (thousand extensions) decree, Italy’s new Monti Government will earn an additional 15 million euro from tobacco; however, Italian smokers will have to pay out almost 20 million. This is because four and a half are the additional “pizzo” – swindle money – that will go to Philip Morris, British American Tobacco and Japan Tobacco. In fact, the decree plans for an increase of the tax revenue from cigarettes, but not an increase in the tax pressure, which would call for raising the excise aliquot, and this would not be appreciated by Big Tobacco.
All this means that when cigarette costs rise, it is the “cartel” of the three multinationals that raise the prices; it is not the State that decides to increase the taxes. It’s true that when prices rise with this system, the cigarette makers take in more and the State, too, earns more. The problem is that in normal countries, including the countries of the third world, the State receives the entire amount. Read more »
On last December 17th, the government gave its preliminary approval to a plan for a legislative decree to implement European Community Directive 2010/12/CE regarding the structure and the aliquots of the excises applied to processed tobacco products, and to align current Italian regulations with the sentence of the European Court of Justice that has condemned Italy for applying a minimum price on cigarettes.
In 2011 hundreds and hundreds of millions of euro of profits of the so-called cigarette manufacturers' cartel could be redirected into the coffers of the State. Is it true that the Italian market, the hunting grounds of Philip Morris, B.A.T. and Japan Tobacco, is about to be liberalized, as the European Court has sentenced?
Why are tobacco-processing factories being closed in Italy and their workers laid off? The cigarette market is not feeling the economic crisis. Philip Morris, British American Tobacco and Japan Tobacco, that hold 99% of the market, bring in profits per pack in Italy considerably higher than those of other European countries, they have no competition and they pay no taxes.
Italo Volpe, head of the Legal Office of the Treasury Ministry, responding to a letter Yesmoke sent, communicated that the regulation of the minimum price “will be abrogated as soon as possible due to the recent sentence of the European Court of Justice”, but he skipped mentioning the ridiculous “minimum tax” that will cancel out any benefits of the abrogation.
It all started in early July with British American Tobacco; the company brought down its prices of Lucky Strikes and Rothmans by 20 cents.
