Japan - with tax increase in place, fewer smokers buying cigarettes so far..

October 2, 2010 - As of Friday, October 1, 2010 an increase in the tobacco tax pushed cigarette prices up by a record-high 60 yen (0.72 USD) to 140 yen (1.68 USD) per 20-cigarette pack, as tobacco shops worried about a drop in business and many smokers vowed to kick the habit.

The smoking rate in Japan in 2008 was 36.8 percent for men and 9.1 percent for women. To help bring these numbers down, the health ministry has proposed another tobacco tax increase as part of tax system reform for fiscal 2011, stating that tobacco prices in this country are still low compared to other advanced nations.

According to a survey conducted on 316 smokers by pharmaceutical company Johnson & Johnson K.K. before the hike, about 60 percent said they would quit. Of these, 58 percent cited financial reasons.

The price of Mild Seven, the most popular brand sold by Japan Tobacco Inc., rose from 300 yen (3.60 USD) to 410 yen (4.93 USD) per pack. A pack of Marlboro from Philip Morris Japan K.K. went from 320 yen (3.85 USD) to 440 yen (5.29 USD).

After closing Thursday, September 30th the Amaya Shoten tobacco shop in a business district in Chuo Ward, Tokyo, put new price tags on about 100 brands of cigarettes on its shelves. Only four customers came to the shop Friday, October 1st between 7 a.m. and 10 a.m., although it usually sees more than 20 salaried workers during that time. Sales from September 20 to 30 were 4.5 times more than in the same period last year.

"It's inevitable that we'll have few customers for a while, but I'm worried whether they'll come back," said shop operator Toshiyuki Amaya, 55.

Tobacco sales skyrocketed nationwide before the tax hike. On Thursday, Seven-Eleven Japan Co. sold about eight times more than on the same day last year, a company spokesman said. (Japan - smokers stocking up on cigarettes before October 1st tax hike..)

Reefrence: Cigarette prices soar, The Yomiuri Shimbun, Yomiuri.co.jp, 10/2/2010.

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