Cigarette prices to double in 2006

The Ministry of Finance is planning to raise excise duties for tobacco, alcohol, petroleum products and gambling, as well improve tax and contribution collection, in order to give a boost to budget revenues. This will mean the price of a pack of cigarettes could double in 2006. “We intend to increase revenues to the budget from the grey and black economy, as well as from areas of the economy that are as yet untaxed,” Finance Minister Sebastian Vladescu said on Tuesday. He explained that improved tax collection for these segments would also act as a means to boost budget revenues, given that VAT will no longer be increased and social security contributions are set to fall. Speaking about a temporary cut to excise duties on petroleum products to offset the increase in petroleum prices on international markets, the Finance Minister said such a step was out of the question. “We don”t have enough budget revenues to support that,” he said. ZF