Taiwan lawmakers fail to raise tobacco tax..

December 26, 2008 - The Legislative Yuan (the Parliament) Monday, December 22, 2008 failed to pass any hikes in tobacco taxes, despite a wide range of proposals.

Lawmakers filed varying proposals to raise the current NT$10 (0.303USD) tax per packet of 20 cigarettes to NT$15, NT$20 or NT$40 (1.212USD) to discourage smoking, but because they failed to reach a consensus, the topic of higher cigarette taxes was referred to further negotiation. Ruling Kuomintang legislator Chang Shuo-wen proposed a hike to NT$40 while rejecting allegations he was trying to sabotage any rises. He said smaller increases would not work if the aim was to discourage smoking altogether.

Some lawmakers pointed out a contradiction in the government’s plans for the hike. “The country sells tobacco, but also bans tobacco,” said KMT legislator Lee Hung-chun, calling on the government to sell the

Taiwan Tobacco and Liquor Corporation - state-owned manufacturer and distributor of cigarettes and alcohol in Taiwan.

Lawmakers did agree on tougher measures against cigarette smuggling and on forcing the Department of Health to spend at least 6 percent of revenue from the tobacco tax on cancer prevention work.

The discussion about hiking tobacco taxation is coming amid preparations for the launch of a newly amended Tobacco Hazards Prevention Act on January 11. Under the new rules, smoking will be banned in all indoor workplaces staffed by at least three employees. Smoking will also be illegal in public indoor areas such as passenger waiting rooms and entertainment areas such as tea rooms, KTV parlors, and bowling alleys. The ban also covers some outdoor public areas such as train station platforms, swimming pools, school campuses and sports stadiums. The new act stipulates fines ranging from NT$2,000 (60.59USD) to NT$10,000 (302.95USD) for offenders.

Anti-smoking campaigners say the habit and its related diseases cost the National Health Insurance Bureau NT$30 billion in extra expenses a year. A 2005 study found from the public health and financial perspectives, the increase in this excise tax on tobacco to the Taiwan government will have significant effect in reducing cigarette consumption; it would also generate additional tax revenues - ABSTRACT.

Reference: Taiwan Legislature fails to raise tobacco taxTaiwan News, Staff Writer, 12/22/2008.

Euromonitor International: Tobacco in Taiwan. There are currently more than 4.5 million smokers in Taiwan, and that about 20,000 people die from smoking related illnesses every year. A pack of cigarettes can cost as little as NT$40 (US$1.3). (DOH (Department of Health) to push for NT$10 cigarette tax price increaseThe China Post, 10/22/2008)