Bulgaria - cigarette excise revenue down this year..

December 23, 2010 - Bulgaria’s cigarette excise revenue this year, at BGN1.686 billion, was BGN100 million down on that of 2009, according to a Novinite story quoting the country’s Customs Agency. [1 USD = 1.49094 BGN]

Reduced output at Bulgartabac’s plants at Sofia and Blagoevgrad was said to have meant that the state enterprise’s excise contribution dropped by BGN280 million, or 32 per cent.

The Customs Agency press service says that the agency’s efforts are concentrated on fighting contraband and the evasion of excise duties. It says that since the start of this year, customs officers have seized a total of 242.2 million contraband cigarettes, a figure that is many times higher than the number of contraband cigarettes seized in previous years. From 2007 to 2009 ‘only’ 53.6 million contraband cigarettes were seized by officers. (Bulgaria - Director of the Customs Agency announced Bulgaria ranks 1st in Europe in seizure of contraband cigarettes..) Bulgarian Customs Officer Dies during Search for Smuggled Cigarettes.., Novinite.com, 12/6/2010.

At the end of March, Bulgaria’s former Interior Minister, Rumen Petkov, severely criticised the government over its policy of excise duty increases. Petkov said there had been a 15 percent fall in revenue since the increase in cigarette excise duty earlier in the year. He said the cigarette markets in Pleven and Nikopol in North Bulgaria were rife with contraband stock.

In January, Bulgartabac warned that illicit cigarettes would take 40 percent of the country’s total cigarette trade this year as a result of the increase in excise duty.

At the beginning of this year, the specific element of the excise duty was raised from BGN41 to BGN101 per 1,000 cigarettes, while the ad valorem element was reduced from 40.5 percent to 23.0 percent. The new duties increased the retail price of a pack of cigarettes by between BGN1.10 (0.74 USD) and BGN1.60 (1.07 USD), and the price of the best-selling Victory brand rose from BGN3.40 (2.28 USD) to BGN5.00 (3.35 USD).

Within weeks of the excise increase, the Bulgarian Customs Agency was forced to announce that, with immediate effect, new limits had been imposed on personal imports of tobacco products by travelers entering Bulgaria by road, sea or river crossings from outside the European Union (EU).

Reference: Bulgarian Customs Boast Decent Revenues in 2010, Novinite.com, 12/22/2010.

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