Cigarettes to stay expensive

[NewsWhore]

Smokers might have cheered last week when it was announced that the 100% ad valorem tax on tobacco products would be reduced to 20%, but there is more than meets the eye when it comes to the tax reduction. Diario Libre writes that although the proposal is to reduce to the tax to 20%, the proposal includes a 54.5% fixed tax, making the proposed reduction almost invisible. Currently, a box of 20 cigarettes pay a RD$16.82 tax and a 100% ad valorem tax, but the proposal would decrease the ad valorem to 20%, although the regular tax would increase to RD$26.00. Accordingly, a box of 10 cigarettes would pay a RD$13.00 tax, up from RD$8.41. At this moment a box of 20 cigarettes costs between RD$80 and RD$95 and a 10-cigarette box costs between RD$45 and RD$50, but with the tax reduction they could end up costing RD$30 and RD$60.

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