Will the Minister indicate the current aggregate value of tobacco taxes per annum? Will he briefly outline the implications for inflation of increasing tax on tobacco?
SECTION 59.
Question proposed: "That the section 59 stand part of the Bill."
Mr. McDowell
Subject to confirmation, the total value of the tobacco yield is £515 million. This increase is expected to yield £14.9 million in 1997 and £17.6 million in a full year and the estimated impact on the CPI is 0.11 per cent. It is expected that an increase of 7p will reduce projected consumption by 0.6 per cent compared to what it might be otherwise.
What would be the position if tax take was increased?
Because of distortions in consumption patterns due to the illegal sale of cigarettes I am not able to give the Deputy an accurate picture of a comparative analysis between tax rates and the elasticity of demand.
It is a fair old whack.
Will a crackdown on the sale of illegal cigarettes help in that regard?
We are tightening up some of the provisions in relation to it. We believe it will help. This matter arises later.
Question put and agreed to.
Section 60 agreed to.