Enda Kenny (Mayo, Fine Gael) | Oireachtas source

I move:

(1) THAT for the purposes of the tax charged by virtue of section 72 of the Finance Act 2005 (No. 5 of 2005), that Act be amended, with effect as on and from 14 October 2015, by substituting the following for Schedule 2 to that Act (as amended by section 60 of the Finance Act 2014 (No. 37 of 2014)):

"SCHEDULE 2

RATES OF TOBACCO PRODUCTS TAX

(With effect as on and from 14 October 2015)

Description of Product	Rate of Tax
Cigarettes	Rate of tax at­- (a) except where paragraph (b) applies, €271.96 per thousand together with an amount equal to 9.20 per cent of the price at which the cigarettes are sold by retail, or (b) €307.61 per thousand in respect of cigarettes sold by retail where the rate of tax would be less than that rate had the rate been calculated in accordance with paragraph (a).
Cigars	Rate of tax at €315.359 per kilogram.
Fine-cut tobacco for the rolling of cigarettes	Rate of tax at €291.683 per kilogram.
Other smoking tobacco	Rate of tax at €218.783 per kilogram.

(2) It is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act 1927 (No. 7 of 1927).

Financial Resolution No. 3 provides for excise duty increases on tobacco products with effect from midnight tonight. The increase amounts to 50 cent inclusive of VAT on a pack of 20 cigarettes in the most popular price category together with pro rata increases for other tobacco products. The price of a pack of 20 cigarettes is the most popular price category. Assuming the increase is passed through, the final retail price will increase to €10.50. The excise duty component of this price will be €6.41 and the total tax inclusive of VAT will be €8.37, which represents almost 80% of the price of a pack.

The price and the tax component of cigarettes in Ireland are among the highest in the EU. The high rates of tax prevailing here reflect the long-standing commitment by successive Governments to use tobacco taxation as an instrument to discourage smoking, particularly among younger people. We are making progress on this front. In 2011, 24% of people were daily smokers. The Health Ireland survey carried out this year for the Department of Health indicates that 19% of people are daily smokers now. The figure is still too high and the increase in excise duties announced this afternoon will ensure tobacco taxation continues to play an important role in discouraging the consumption of tobacco products. In the overall context of the budgetary measures introduced this year, there is still a need to raise revenue for the Exchequer. To that end, the increase in excise duty on tobacco products will contribute €8 million to the Exchequer in 2015 and €61.4 million in a full year.

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