Dáil Éireann díospóireacht -
Tuesday, 29 Feb 2000

Vol. 515 No. 3

Written Answers. - Excise Duty.

Pat Carey

Ceist:

173 Mr. P. Carey asked the Minister for Finance if he will review the level of excise duty on pipe tobacco in view of the fact that this form of smoking is largely confined to older men in receipt of old age pensions; and if he will make a statement on the matter. [6017/00]

Minister for Finance (Mr. McCreevy)

In accordance with the terms of Article 5 of Council Directive 95/59/EC, pipe tobacco comes under the definition of other smoking tobacco in the categorisation of excisable manufactured tobacco in that directive. Article 3(1) of Council Directive 92/80/EEC obliges member states to impose a minimum rate of excise duty on other smoking tobacco which is either 20% of the retail selling price inclusive of all taxes, or 18 euros per kilogram. Subject to the achievement of this minimum, the excise duty may be charged either on an ad valorem basis or as a specific duty expressed as an amount per kilogram or as a mixture of both, combining an ad valorem element and a specific element.

The excise duty applied here has always been applied as a specific amount by weight. Because the rate applied has always been above the minimum rate set down in EU law, that law has, in practice, no influence on the determination of our rates. On the basis of relative excise duty by weight of product, pipe tobacco has always been treated more favourably than other tobacco products. For example, following the recent budget increase, fine-cut tobacco for the rolling of ciga rettes is taxed at £104.19 per kilogram whereas pipe tobacco is taxed at £85.66 per kilogram.

While I appreciate the point raised by the Deputy, I wish to confirm that I have no immediate plans to review the level of excise duty on pipe tobacco.