Paschal Donohoe (Dublin Central, Fine Gael)
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To deal with Deputy Michael McGrath's question first, we brought in the minimum excise price in last year's budget. I decided not to make a further change to it because the initial change was so recent. In 2018 the minimum excise duty was increased for the first time to equate to a trigger price point of €11 for a pack of 20 cigarettes. A pack that costs less than €11, as the Deputy knows, will be taxed as if it was €11. This has led to a set of price increases for almost all packs of 20 cigarettes, most of which now cost at least €11. The decision I made was to let that settle for a few years before determining whether a further change is needed. That is what happened there. We did it last year.

Two other questions were put to me. The first was about where we stand for this year. Currently we are looking at a delivery of €1.1 billion under this tax head, which is approximately €30 million off our expectation or a 1.1% variance on our forecast. If one looks at our projected performance under that tax head, our current performance is okay relative to our position in previous years. Deputy Doherty also asked if there is data available to explain what happened last year and the previous year. Revenue has provided information to me just now on the results of surveys that it has done concerning cigarettes that were legally purchased abroad as well as an estimate of the number of illicit cigarettes consumed in this jurisdiction. In 2017 and 2018 a significant amount of regulatory change happened across that period, at both an EU and domestic level. A track and trace provision was introduced at an EU level in that period, for example, and the roll-out in Ireland of plain packaging happened at the same time. If one looks at the two years together, in the run up to that period, the number of cigarettes that were legally purchased abroad was between 5% and 6% but across 2017 and 2018, that figure went up to 9%. In terms of the number of illicit cigarettes that Revenue believes were consumed in this jurisdiction, data indicates that between 2014 and 2016, the low point was 10% and the high point was 12%. In 2017 and 2018, Revenue believes that figure rose to 13%. My crude summary of what happened is that I cannot optimistically say that the decline in revenue across that period was due to heightened positive health benefits. The figures indicate that because of the amount of regulatory change that happened in the period, other things happened, including more cigarettes being legally purchased elsewhere or a peak in the consumption of illicit cigarettes. It appears that the tax heads is more stable this year than it has been in the previous two years. In conjunction with that, Revenue continues to do a huge amount of work on the detection of illegal cigarettes. Last year alone Revenue seized 68 million cigarettes that it believed to be illegal.