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Bulgaria Parliament Approves Cigarette Tax Hike

Date: 26.11.2009

Bulgaria’s Members of the Parliament voted Thursday to increase the cigarettes tax

The MPs decided on second reading to establish a BGN 101 excise for 1 000 cigarettes instead of the current BGN 41, while the proportional tax will be 23 % of the sales price instead of the current 40.5 %. The later will affect mostly expensive cigarette brands.

The first proposal was for a tax of BGN 74 for 1 000 cigarettes and 36 % of the sales price.

The tax for tobacco for pipes and cigarettes is set at BGN 100 per kg.

The opposition left-wing declared they oppose the tax hike. Kornelia Ninova, MP and spokesperson of the Bulgarian Socialist Party (BSP), defined the move as a mistake, pointing out the negotiated agreement with the EU is for lower tax and the increase would contribute to wide-spread contraband instead of curbing smoking. According to Ninova, the tax increase will hit hard the Bulgarian cigarette maker Bulgartabac which employees 2 000 workers.

She was backed by Aliosman Imamov, from the ethnic Turksih Movement for Rights and Freedoms (DPS) party, who also said the changes will hurt Bulgartabac.

The new duties will increase the price of a pack of cigarettes anywhere between BGN 1.10 and 1.40 making the price of the best-selling Victory brand BGN 5 instead of the current BGN 3.40.

Earlier Thursday, the MPs approved a 15 % increase of the gambling tax, but decided to not touch the alcohol one.

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