Financial Resolution No. 5 provides for increases in the rates of excise duty applying to tobacco products, with effect from midnight tonight. The increase amounts to 50 cent, VAT inclusive, on a packet of 20 cigarettes, with pro rata increases in other tobacco products. The price of a packet of 20 cigarettes, in the most popular price category, will increase to approximately €8.05. This may well be the highest tobacco price in the European union. Ireland's high tobacco price levels reflect the action that has been taken over the years to ensure that taxation policy plays a part in the Government's strategy to protect public health by discouraging smoking. After this increase has taken effect, the overall tax take, in terms of excise duty and VAT, from the price of a packet of 20 cigarettes will be approximately €6.37, or slightly over 79% of the sale price. The excise duty element of the price of cigarettes in Ireland will be the highest in the EU, ahead of the UK, and compares to an average excise take across all member states of €2. At present, a packet of 20 cigarettes is approximately 27 cent more expensive in this jurisdiction than on the other side of the Border. This has changed considerably since last year, when the price differential was €1.03 in our favour. That change can be attributed, in large part, to exchange rate changes. Following this increase, the differential will increase to 77 cent.

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