Azerbaijan increases excises on cigarettes

By Azernews

By Sara Israfilbayova

Stable prices for tobacco products were achieved due to the growth of local production and a decrease in cigarette imports, but the revision of excises can change the situation.

Azerbaijani President Ilham Aliyev has signed an order on the application of the “Law on Amendments to the Tax Code of Azerbaijan” dated July 12, 2018.

In line with the changes to Article 190 of the Code (List of Excisable Goods and Tax Rates), a tax of 12 manats ($7) will be levied for every 1,000 cigarettes produced in Azerbaijan. Previously, this tax amounted to 4 manats ($2).

In accordance with another amendment, a tax of 20 manats ($11.7) will be levied for every 1,000 cigars and cigarillos produced in Azerbaijan. Earlier, this tax amounted to 10 manats ($5.8).

The State Statistics Committee of Azerbaijan reported that in May 2018 price indices for tobacco products decreased by 0.9 percent, as compared to April 2018, and by 16.2 percent, as compared to May 2017.

However, for the first five months of the year 1.275 billion cigarettes were produced in the country. For the reporting period the country produced more cigarettes than during the entire 2017, when 1.241 billion cigarettes were produced.

Earlier, country manager of the World Bank (WB) Naveed Hassan Naqvi repeatedly made proposals to the Azerbaijani government to increase excise taxes on tobacco products and thereby, raising prices, to limit the population’s access to cigarettes. In his opinion, this will increase revenues to the state budget, and will positively affect the health of the nation, limiting the number of smokers.

The Azerbaijani government heard calls from the WB experts and increased excise taxes on manufactured tobacco products in the country.

Smoking is common throughout the world, and getting people out of tobacco dependence today is becoming a priority for many states.

Smoking is recognized as a chronic disease and included in the "International Statistical Classification of Diseases and Related Health Problems". There are more than 25 diseases that develop or their course worsens under the influence of smoking.

Smoking is being prohibited as it is decreed that smokers’ habits are setting a bad example to others, particularly children. Also, active smokers can estimate the harm of tobacco on their health and decide whether to smoke or not, but those who are passive smokers had no choice here and passive smoking is more harmful for human body than active smoking.

Such prohibitions already exist in such countries as the U.S., Finland, Ukraine, Great Britain, Scotland, Northern Ireland, Germany, France, Belgium, Croatia, Greece, Turkey, Kazakhstan, Syria, Egypt and etc.

Azerbaijan, which also fights against smoking, adopted the Law “On Restriction of the Use of Tobacco Products” on December 1, 2017.

In accordance with the law, smoking is forbidden throughout the territory of various educational institutions, in hotels, health care facilities, rehabilitation centers, health resorts, social facilities, theaters and cinemas, at exhibitions, reading rooms, libraries, museums and other cultural institutions, in underground and overground crossings, buses (including intercity and international), taxis, metro, air, railway, sea and river transport, bus stops, railway stations, river and sea ports, airports, elevators, common areas of multi-apartment buildings, in buildings and enterprises where flammable substances are stored, on playgrounds, beaches, workplaces of organizations, enterprises, offices, regardless of organizational and legal form and ownership.

Allocation of places for smoking will be transferred to the discretion of employers. In addition, municipalities are given additional powers to take action against the use of tobacco products. They will take steps to restrict the use of tobacco products.