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July / August, 2007

Illegal cigarette sales on rise
OTTAWA - Illegal cigarette sales that dodge federal and provincial taxes are rising at an alarming rate and the gov­ernment should combat the trend by re­ducing tobacco taxes, according to a to­bacco manufacturer’s association study.

The Canadian Tobacco Manufacturers’ Council recently an­nounced the results of a study that shows that 22% of cigarettes smoked in Canada are contraband. The figure is 30.5% in Quebec, the group says.

The council says illegal tobacco sales are costing the Canadian and provincial governments CS 1.6 bn a year in lost taxes.

Yves-Thomas Dorval, a spokesper­son for Imperial Tobacco Canada, which dominates the Canadian ciga­rette market with at least 60% of sales, blamed the illegal tobacco sales or na­tives and organized crime. He went on to say 90% of the illegal cigarettes are manufactured in plants over which the government has no control and impos­es no restrictions. Many of these con­traband brands are manufactured on native reserves in Ontario, Quebec, and New York State.

Fiscal reform proposal to raise cigarette tax
PRAGUE - Consumer tax on cigarettes will likely be higher than as originally pro­posed in the Czech government’s fiscal re­form package, in order to meet the Czech Republic’s promise to the EU, made on the country’s accession to the union, daily ME Dnes reported.

The tax will likely hike the price of each pack of cigarettes by 5 crowns, compared to the previously proposed 4 crowns, to meet the EU requirement that the minimal tax on one thousand cigarettes equals €64 euro.

DR cigar industry fears effects of proposed US tax
SANTO DOMINICO - Amilcar Romero, the head of the Dominican senate’s Farm and Agribusiness Commission asked the US Congress to reject a new tax on cigars, as it would condemn the national tobacco industry.”

He went on to say a new US tax on cigars would cause losses of over US$100 mn for the industry, in addi­tion to the loss of jobs in one of the country’s poorest zones.

The Cigar Producers Association (Procigar) stated their concern to Romero on the Dominican cigars’ fu­ture, if the new tax is approved. They said, if approved, the legislative piece would be a hard blow for the cottage industry’s 25000 direct jobs. This would aggravate unemployment in the country, already affected from the reduction experienced by the free zones sector.”

The current US tax on a cigar in is 5 cents per cigar, though would climb to 53O/~ of the cigar’s value at the time it enters the US, with a maximum tax of $10.00 per cigar.

Nicaragua has also objected to the tax, as it would stand to lose 60 mn dol­lars a year, because 69% of its cigar ex­ports are destined for the US.

Chinese company invests in Romanian cigarette factory
BUCHAREST - Chinese company Sinoroma Industry invested €36 mn in building a cigarette factory in the village of Parscov, just north-east of Bucharest.

"The opening of the factory in Parscov is one of the major Chinese investments in Romania, and not only because of the efforts of the county authorities to attract foreign funds to [the county of] Buzau, but also due to the important amounts which are thus going to the county budget, to contribute further to the improvement of all the infrastructure segments in Buzau, usually financed from the County Council budget" Chairman of Buzau County Council Victor Mocanu said on the inaugura­tion ceremony.

61st Tobacco Science Research Conference
CHARLOTTE - The 61st Tobacco Science Research Conference will be held in Charlotte, North Carolina September 23—26, 2007. Wattenspapier, a delfort-group company will host the conference at the Hilton Charlotte University Place Hotel.

“Frontiers in Tobacco Biotechnology” is the topic of this year’s symposium. A variety of experts have been invited to share their ~news on this diverse topic. The symposium will be followed by two days of scientific paper and poster presentations.

For more information about the conference, sponsorship opportuni­ties, abstract submissions, visit:www.tsrcinfo.com.

Tobacco International - July/August, 2007

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