Text Version
RSS Feeds
Newsletter
Home Forum Photos Features Newsletter Archive Employment
About US Help Site Map
SEARCH   About US FAQ Site Map Site News
  SERVICES
  -Text Version
  -RSS Feeds
  -Newsletter
  -News Archive
  -Give us feedback
  -Voices of Readers
  -Online community
  -China Biz info
  What's new
 -
 -
Cigarette tax increased to cut smoking
+ -
08:17, June 22, 2009

Click the "PLAY" button and listen. Do you like the online audio service here?
Good, I like it
Just so so
I don't like it
No interest
 Related News
 China to accelerate resource tax reform
 Traffic resumes in east China after furniture dealers' protest on highway
 No butts: China's discipline watchdog to ban cigarette purchase by public funds
 Chinese gov't offers 120 bln yuan in tax cuts in Q1
 Fake tax invoices find real growth
 Comment  Tell A Friend
 Print Format  Save Article
The government has raised consumption tax on cigarettes by between 6 and 11 percent to curb smoking and add revenue to State coffers.

The tax hike took effect on May 1 but was made public over the weekend along with a levy of 5 percent imposed on cigarette wholesalers, according to a statement by the State Administration of Taxation.

The tax has not yet been passed on to smokers and it is unclear how much of the increase tobacco companies, wholesalers and retailers will absorb.

"The move will not only increase government revenue but also save the lives of millions," Li Ling,a professor at the National School of Development at Peking University, told Xinhua News Agency.

The Chinese Association of Tobacco Control said in a statement yesterday: "Efforts to increase the tobacco tax and lift tobacco prices have proven the most effective in reducing smoking among smokers of all income levels. It will prevent young people from smoking and encourage more smokers to quit the harmful habit."

The country has more than 350 million smokers, about a third of the population. Each year, more than 1 million people die from smoking-related illnesses.

Experts estimate that the annual death toll could rise to 2 million by 2025 and 3 million by 2050 as the effects of smoking start to appear on the increasing number of today's teenage smokers.

The nation is the world's largest cigarette market, with annual sales of two trillion cigarettes. But the government has been stepping up efforts to curb tobacco consumption over the years, especially after it joined the World Health Organization (WHO) Framework Convention on Tobacco Control in 2005.

Experts say the nation's taxation on tobacco products, about 40 percent on average, is well below that in most other countries, which is around 60 percent.

Even if the entire tax increase is borne by smokers, the price of an average cigarette packet on the mainland would be less than a third than in developed economies.

"We haven't raised prices yet but will do so soon," said Li Lin, a clerk at a cigarette shop in Beijing's Chaoyang district.

Li said the tax increase would further dent business, adding sales have dropped substantially this year due to the financial crisis.

But Li, who smokes two packs everyday, said increased prices would have no effect on him. "I can give up meals but not cigarettes," he said, puffing out a cloud of smoke.

The tax increase will add about 30 billion yuan of extra revenue for the central government, an unnamed official was quoted by Reuters as saying. The government has budgeted a record deficit for 2009 to fund its 4 trillion yuan ($586 billion) stimulus package.

Government revenue declined 6.7 percent in the first five months this year, compared with the same period a year earlier, even as spending surged 27.8 percent in the same period.

The government expects revenues to grow 8 percent to 6.6 trillion yuan in 2009, according to the budget announced in March.

"The main purpose of this policy is to increase the tax revenue from cigarettes, not to control smoking in the country," Mao Zhengzhong, professor at the College of Public Health of Sichuan University, told China Daily yesterday.

He said cigarette makers may pass on all, or part of, the tax to retailers, or absorb it themselves.

Mao urged the government to increase the tax to 65 percent of the retail price to curb smoking, adding: "There is still a lot of room to raise the tax."

Source: China Daily



  Your Message:   Most Commented:
India's unwise military moves
China slams Clinton's June 4 comments
13 more bodies from Air France flight 447 recovered
To Be or Not To Be-- reflourishing bicycle in China
Yonhap: DPRK fires short-range missile off east coast

|About Peopledaily.com.cn | Advertise on site | Contact us | Site map | Job offer|
Copyright by People's Daily Online, All Rights Reserved

http://english.people.com.cn/90001/90776/6682967.pdf