Stephen Donnelly (Wicklow, Independent)
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We are unable to table amendments that would involve a charge on Revenue, but the proposal made in the amendment came from the Irish Cancer Society. It is marginal and in the direction the Government is moving and the section provides an opportunity to accelerate the move.

There are four elements to the price of tobacco - the specific tax, the ad valorem tax, VAT and the non-tax price. The idea is that the ad valorem tax would be reduced to zero. We are aware that because of EU rules it cannot be zero. It would be great if the Minister and his officials would consider tabling an amendment on Report Stage. I proposed a nominal tax of 0.2% to comply with EU rules. The main reason for this is that if one examines prices between 2001 and 2011 - the breakdown for 2012 is not yet available - the price of a pack increased by 75%, while the non-tax element which goes to the manufacturers and transporters but not the retailers increased by 72%. The Irish Cancer Society states the Government has been doing the right thing by increasing the price, but, at the same time, the manufacturers have used the opportunity to significantly increase their profits. I do not have evidence to back this up, but the Irish Cancer Society asserts - it has data which I have not seen - they are subsidising the cheaper cigarettes. The more expensive cigarettes take a bigger hit, while the cheaper cigarettes remain cheap, thus minimising the potential impact, which could be considerable. The data we have suggest a €1 increase in the price of a pack would reduce consumption by approximately 4%, which would be useful. Anyone who smokes ten cigarettes a day spends approximately €1,500 a year, but a €1 increase would lead to a 4% reduction in consumption. This is similar to our discussion on university fees. There is an opportunity to accelerate what seems to be Government policy and bring the ad valorem tax to just above zero. The idea is that it would minimise the tobacco companies' ability to keep cheaper cigarettes cheap, thus keep people smoking.