Phil Hogan (Carlow-Kilkenny, Fine Gael)
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Question 122: To ask the Minister for Finance further to Parliamentary Question No. 112 of 29 June, if he will provide the breakdown of taxation on cigarettes including the percentage of ad valorem tax and percentage of specific excise duty on cigarettes; if he will consider introducing measures similar to Sweden (details supplied) where the Minister for Finance has proposed reform of the taxation structure on cigarettes in order to prevent cheap cigarettes entering the market as well as increasing their overall revenue from cigarettes; and if he will make a statement on the matter. [30423/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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In accordance with the relevant EU Directive the overall excise duty on cigarettes is made up of a specific (fixed) element and an ad valorem element. Based on the information already available to my Department, and that supplied by the Deputy, Sweden have put forward proposals to move its excise duty on cigarettes from being one based mainly on the ad valorem element to one based mainly on the specific element.

As stated in my reply to Parliamentary Question No. 112 of 29 June 2010, Ireland already applies a high specific duty element and a low ad valorem element in setting its excise duty for cigarettes relative to other Member States. It is intended to continue that approach in setting our excise duty for cigarettes. It has also to be recognised that Ireland has the highest prices and excise duty levels for cigarettes in the EU. For example the level of excise duty on cigarettes in Ireland (€5.22 for a packet of 20) is around double that in Sweden. It should also be noted that the increase in excise duty on cigarettes since Budget 2007 (December 2006) far exceeds increases in inflation over that period.