Careful consideration was given to calls before the budget for substantial increases in the price of cigarettes on health protection grounds. However, account had to be taken of the fact that the high price of cigarettes here can make Ireland an attractive place for cigarette smuggling. The Revenue Commissioners have applied significant resources to tackling all aspects of cigarette and tobacco smuggling. They have engaged with the tobacco industry on this matter. It is estimated that this proposed measure will yield approximately €16 million in 2008 and €105 million in a full year. It will have an impact of approximately 0.21% on the consumer price index. The increase is expected to reduce cigarette consumption next year by approximately 1.3%.

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