Inequitable regulation in terms of taxation in the tobacco market will lead to its destabilization and will increase the illegal turnover of products.

Inequitable regulation in terms of taxation in the tobacco market will lead to its destabilization and will increase the illegal turnover of products.

The general manager of Philip Morris and Marketing LLS Denis Zhogolev said this at a meeting with journalists on Tuesday. He, in particular, noted that products which cause less harm to health than cigarettes (as evidenced by a number of international research institutes and regulators in the UK, USA and other countries) are taxed in a separate category and cannot be equated to cigarettes, as it is not a product of combustion. This is a company’s heet-not-burn IQOS product, which uses heets. As InfoMarket agency reported, a bill was initiated in parliament, according to which the sticks for tobacco heating systems are equal to cigarettes and are subject to the same taxation, which will actually increase the excise tax on sticks by 11 times. The government made its corrections, generally supporting the project, and in the conclusion of the government it was proposed that an excise tax in the amount of 610 lei per 1 thousand pieces in 2019 and 700 lei per 1 thousand pieces in 2020 be applied to cigarettes for tobacco heating devices. The bill is to be considered at the meeting of the parliament. Denis Zhogolev noted that in Europe, where governments support switching to alternative nicotine-like cigarettes, excise taxes on cigarettes are on average 63% higher than on stickies; while in the UK, cigarette taxes are 8 times higher, and in Poland, excise taxes are not applied to sticks. “Tobacco heating systems are the best alternative for non-burning products for all smokers. We do not say that there is no harm in them at all, but the level of toxic substances in the IQOS aerosol is 90% lower than in the smoke of traditional cigarettes, ”said the executive director of Philip Morris Ucraina, Caucasus, Moldova Michalis Alexandrakis. “Market regulation and taxation is an exclusive prerogative of the state, we just want to convey information that the best solution in the entire history of the tobacco industry has appeared, which causes less harm to smokers and does not contain combustion products. And it should be taxed separately from cigarettes, ”said Michalis Alexandrakis, noting that Moldova already has 22 thousand users of IQOS systems (average age is 35-45 years), and a sharp increase in the cost of sticks will result in many for economic reasons, can return to cigarette consumption. Georgia was given as an example, where IQOS and stick sales are prohibited, however, there are more than 4 thousand users of these systems in the country, and the state does not receive any taxes from it. Moldova is a risk zone in terms of a possible increase in smuggling, given Transnistria and Ukraine, where more than 300 thousand IQOS users are registered. “Our company is one of the largest taxpayers, in 2018 we sent about 1 billion lei to the budget. And over the year since the start of sales of IQOS systems, more than 200 new jobs have been created, since this is a comprehensive sale, service, etc., ”said Denis Zhogolev. At a meeting with journalists, it was also noted that in 2014 (before the adoption of the anti-tobacco legislation package), there were about 43% of smokers (men) in the country; as of July 2019, this percentage has not changed: about 610 thousand people or about a quarter of the country's population. On Wednesday, July 17, a public hearing will be held in Parliament regarding changes to anti-tobacco legislation.// 16.07.2019 — InfoMarket.

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