BBB proposes lowering excise duties on cigarettes to boost tax revenues

BBB parliamentarian Henk Vermeer wants to reverse the increase in excise duties on tobacco products now that the revenue from the measure proved lower than expected. Cancer organization KWF Kankerbestrijding is very much against the idea, pointing out that the excise increase was not to raise money for the treasury, but to discourage young people from smoking, RTL Nieuws reports.

The excise duties on tobacco products increased considerably on April 1. The excise duty per pack of 20 cigarettes rose from 5.85 euros to 7.81 euros. A pack of cigarettes now costs over 11 euros in the Netherlands.

However, the revenues from the excise duty hike proved disappointing. The latest figures show that the hike will raise some 550 million euros less than expected, the Ministry of Finance confirmed to the broadcaster. The sale of tobacco products in the Netherlands declined so much that the revenue from the tobacco excise duty is falling.

Research by the RIVM showed that around 10 percent of smokers quit because of the more expensive cigarettes. The researchers also noted that the share of cigarettes from abroad increased from 24-28 percent to 35-39 percent.

“These figures substantiate what I already predicted,” Vermeer told RTL. “The only thing that is decreasing is the government’s tax revenue. While the number of smokers is not demonstrably decreasing. You’re stealing from the treasury if you do not reverse the excise increase.”

According to the coalition party, people crossing the border to buy their cigarettes likely do their other shopping there too. “That also means less revenue from VAT and corporate tax,” Vermeer said.

KWF Kankerbestrijding is vehemently against the idea of making cigarettes cheaper again. The excise increase was not about lining the government’s pockets, but about preventing young people from starting to smoke, director Caral van Gils told the broadcaster. “Making cigarettes more expensive is very important and works. There is more than enough scientific evidence for that.”