Baccy apart

Presidential veto on legislation to raise the excise tax on tobacco would cost the treasury about 6 billion UAH. year. These funds, the Government planned to extend the development of domestic medicine and an increase in funding the army. Decision guarantor - is not only a huge budget losses, but also fertile soil for the growth of smuggling cigarettes Ukrainian production to the EU. What, in turn, would postpone the entry of Ukraine into a free trade area EU.
"Green light" for smuggling
To begin with, the parliament voted a law would increase the rate of excise duty on cigarettes from 20% to 36% of the maximum retail price. In particular, for 1000 products without the filter, instead of 35 UAH. manufacturers would have to pay 44 grn. and with the filter - 80 UAH. instead of 60.
It should be noted that in the current year was anticipated to be the third increase in the tax burden on manufacturers of tobacco products. Purpose - not only to boost the coffers with additional financial resources, but also to gradually bring rates of excise duty in line with European ones. This is the main condition set before our country for entry into the EU free trade zone. Today, tobacco products in the retail network of European cities ten times higher than in Ukraine. And on Nov. 10 EU Council of Ministers of Economy and Finance decided to raise from January 1, 2011 excise tax is 30%. This price difference has become very profitable for smugglers. According to the State Customs, from January to August 2009 on the border was delayed 35.4 million pieces of cigarettes (1.8 million packages). And the amount of the total turnover of funds from the export of black tobacco estimate the extras in a few billion hryvnia. In 30,7% of the smuggled cigarettes was carried out in Hungary, 27.8% - in Romania and 3,8% - to Russia.
Covered smokescreen
His regular veto the president explained that the increase in excise tax on cigarettes will cause a massive influx of contraband from Russia, Moldova and Belarus, where today the cost of cigarettes is approximately the same. However, concern the head of state did not share the State customs house, according to which, 84% of all contraband tobacco has on the export of Ukrainian dope and only 16% - on imports.
In addition, Yushchenko says that the new fee will lead to a sharp drop in sales in the domestic tobacco market and, consequently, to losses of the companies in the dismissal of their staff. However, according to the head of the parliamentary committee on tax and customs policy, Sergei Terekhin, production in this industry almost completely automated. It involved only 3000 people. Therefore, a significant reduction in staffing will not happen.
Another interesting fact is that the head of state, worrying about the income of tobacco corporations, it is not thinking about the health of the people. According to the Ministry of Health, every day from diseases caused by smoking in Ukraine, 300 people died. The increased excise tax would make cigarettes less affordable, at least for the majority of children who are getting used to let the smoke still in school. "Yushchenko calls himself a fighter for the nation's health, but actually contributed to its extinction from tobacco", - says member of the Budget Committee of Verkhovna Rada Volodymyr Bondarenko.
Parliamentary coalition plans to overcome the prohibition of Viktor Andreyevich. The MPs argue that the additional budget revenues will be used to finance the army, judiciary and health. However, the guarantor may again become the Party of Regions. "Among the regionals is lobbyist for tobacco companies, which can support the decision of the President", - believes Mr. Bondarenko.