The government should discuss further increases in the cigarette-excise tax rate in Monday. The draft assumes increases as of April 2005 and January 2006. In 2005, it should increase to CZK 0.60 per cigarette plus 0.24% of the cigarette retail price from the current CZK 0.48 and 0.23%. Moreover, the minimum per-cigarette tax should rise from the current CZK 0.94 to CZK 1.13 in 2005 and CZK 1.36 in 2006. By 2007 excise tax should form 57% of the retail price. The tax cannot fall below EUR 60 per 1 000 cigarettes, while the limit should rise by another EUR 4 in 2008. The above news is largely neutral as it has been known for a long time and the increase is in line with our estimates.
source: CTK
Tomáš Gatěk, Patria Finance