A press release by tobacco giant British American Tobacco (BAT) pointed out that due to changes in tax regulations, high-quality alternative tobacco products may become cheaper and more accessible to Hungarian consumers in the near future.
Coming into effect on the 1st of March, a lower excise tax on nicotine-containing e-liquids meaning that prices are expected to drop at national tobacco shops. The tax will be lowered from the current HUF 55 per ml to HUF 20 per ml.
BAT Pécsi Dohány Gyár Kft., a subsidiary of BAT, says that it welcomes the decision, as it does not only make higher-quality products more accessible but help fighting black market liquid sales.
In Hungary, black market sales are thought to account for approximately 80 to 85% of all e-liquid sales, and BAT has estimated that while there are approximately 200,000 e-cigarette users in the country, many of whom may be unaware that they are purchasing unregulated products.
“Hungarian e-cigarette consumers need to be given a chance to access quality refill liquids, just like in other European countries,” says Zoltán Orosz, country manager for Hungary at BAT Central Europe. “The sale of illegal products, besides robbing Hungary of considerable tax income, could endanger e-cigarette users as these products presumably fail to meet Hungarian and EU quality and safety standards.”
“We are proud that our refill liquids at national tobacco shops undergo rigorous testing by the committed research team of BAT group, and that our e-liquids meet all EU requirements,” Orosz notes.
According to research by organizations such as Public Health England, the most damaging substances endangering smokers can get into the body during the burning process of traditional cigarettes, meaning that e-cigarettes may be up to 95% less harmful than traditional ones.
“We have made steps in order to increase the access of domestic consumers to quality-assured products. Meanwhile, we are doing everything we can to keep e-cigarettes a safe option for smokers looking for the alternative of traditional cigarettes,” Orosz explains.
Hungary has taken to court by the EC over tobacco taxes
Meanwhile, in 2019, the European Commission (EC) reported Hungary to the Court of Justice of the European Union (CJEU), for failing to apply the minimum required excise duty on cigarettes, as per European Union (EU) regulations.
Meanwhile, Hungarian news agency MTI has reported that Hungary has raised the excise tax on cigarettes in three increments since September 1, 2018.
“From July 1, 2019, the tax is HUF 19,200 per 1,000 cigarettes plus 23.5% of the retail price, but at least HUF 32,200 per 1,000 cigarettes. The minimum excise tax on a pack of 20 cigarettes calculates as HUF 644, which compares to an average price of HUF 1,310 for a pack of Multi filter brand cigarettes.” MTI noted.
A press release on the EC’s website has explained that Hungary was given until December 31, 2017, to gradually increase the excise duty on cigarettes and reach the required minimum threshold by the EU. However, this was not done and the excise tax remains below what is required by the European Union.
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