Egyptian parliament approves draft law to increase tobacco taxes

Based on amendment, cigarette prices will increase by EGP 3.5-6.5

Egyptian parliament approved on Tuesday a draft law to amend the Value-Added Tax (VAT) Law so as to increase cigarettes and hookah prices.

The draft law, which was submitted by the government, will raise the prices of cigarette packs based on their tranche.

Under the approved amendments, the new prices will include an addition of EGP 3.5 for cigarette packs priced up to EGP 18, EGP 5.5 increase for cigarette packs priced between EGP 18-30, and EGP 6.5 increase for cigarette packs priced above EGP 30.

In July, the Eastern Company raised the price of three cigarette brands by 4.2 – 17.6% (EGP 0.50 – EGP 2.25).

In December 2016, the price of Merit, Marlboro and LM cigarettes rose by 10%, equal to EGP 20 per cartridge and EGP 2 per pack.

Also, on 22 Feb., 2015, a presidential decree hiked taxes on local and imported cigarettes by 50%, in addition to imposing an extra 2.25 pounds on the price of each pack sold to consumers at 10 pounds or less.

According to the Central Agency for Public Mobilisation and Statistics (CAPMAS), 19.6% of Egyptians over the age of 15 smoke, and 60% of smokers between the ages of 15 and 24 smoke on a daily basis.

Another CAPMAS 2015 survey linking smoking to income, expenditure and consumption, found that 41.2% of employees smoke, and the average annual expenditure of an Egyptian household on smoking is EGP 1,722.