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Where there is no law, but every man does what is right in his own eyes, there is the least of real liberty
Henry M. Robert

Sin Taxes Hiked

2 March, 1999 - 00:00

By Yana MOISEYENKOVA, The Day
The Cabinet passed a resolution doubling the cost of excise stamps for
wines and spirits and on tobacco products. From now on alcohol and tobacco
producers will pay Hr 25.88 and Hr. 9.12 per thousand stamps, respectively
(compared to Hr 12.00 and Hr 5.00 previously).

"In principle we are aware that the old costs did not conform to reality.
We also understand the Mint's desire (the Mint is the official producer
of excise stamps - Ya. M.) to maintain profitability. However, we are not
sure about the reaction of wholesalers and retailers," The Day was
told by a Philip Morris spokesman.

An anonymous source states that "raising stamp costs will, of course,
affect sales prices, but this is peanuts compared to the burden of taxes
and duties shaping today's costs." The said source also does not rule out
the possibility of a panic and soaring prices in the wholesale/retail networks.

Remarkably, the Cabinet attributes the February stamp cost rise to the
inflation process after 1995, that the Tax Administration has allegedly
complained for several years about the stamp cost being lower than its
par value. The strange thing is that it took the government until February
1999 to respond to these grievances... Now, by the laws of logic, the Cabinet
should turn its attention to grievances from citizens that have been pouring
in for years on end, namely about their wages being long way behind current
living costs. Well, there is a difference between ordinary citizens and
the Tax Administration. Considering that TA's complaint was heeded four
years later, one can only wonder how long it will take to hear what the
man in the street has to say.

 

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