Trevor Sargent
Question:96 Mr. Sargent asked the Taoiseach the member states of the European Union which quote their consumer price index or equivalent without including tobacco in the basket of products. [14484/97]
Written Answers - Consumer Price Index.
Trevor Sargent
Question:97 Mr. Sargent asked the Taoiseach if he will exclude tobacco products from the consumer price index; and if he will make a statement on the matter. [14485/97]
Every member state of the European Union is obliged to include tobacco products in the Harmonised Index of Consumer Prices (HICP). The HICPs will be used as one of the four criteria in measuring the degree of economic convergence by member states in order to participate in stage III of Economic and Monetary Union.
In parallel with the HICPs most member states also continue to publish their national Consumer Price Indices. With the exception of Italy, tobacco products are included in these national CPIs.
The Irish CPI is compiled by the Central Statistics Office. Under the Statistics Act, 1993 the Director General of the CSO has sole responsibility for, and is independent in deciding, the statistical methodology and professional standards to be used.
The CPI is designed to measure the change in the average level of prices, inclusive of all indirect taxes paid for consumer goods and services by all private households in the country.
The CSO advises that tobacco products account for a significant portion of household expenditure and are, therefore, correctly included in the CPI. This is consistent with standard international practice. Furthermore, a CPI sub-index for tobacco is published by the CSO and it is thus possible to monitor its effect on the overall CPI.