Ms Sophia Rayan
Economics-PSL
Bosnia and Herzegovina has the highest taxation on cigarettes out of all the
countries with a tax of 86%. Israel comes second with 85%. Then it is Slovakia with a tax of
84.6%. Bulgaria has 84% taxation on cigarettes. Finally, Poland with 82.6%%. The reason for
high taxes is that Europe’s average amount of smokers in percent is 27.3%. It is higher than the
global average of 22.7% which is really bad for the countries. From these percentages the main
reason that the government has put higher taxes on cigarettes are evident. The percentage of 15
or older people smoking are given below per country. Greece (42.4%), Bosnia and Herzegovina
aware of the welfareness of the citizens this is not the complete reason why the government
demographic to low income people who cannot afford cigarettes after taxation. This lowers the
amount of people who smoke and reduce smoking-related diseases. It is also a de-merit good
which means that it is harmful for the society. Raising the tax on products like these helps the
government get more revenue. In result, anyways the people kind of get back their money in a
form of better education in public schools or better infrastructure of public buildings etc. The
governments excise tax on certain products like alcohol, cigarettes etc, because it is not really
price elastic because they are no close substitutes to cigarettes and alcohol. Taxes that are
imposed on cigarettes, alcohol,drugs,soft drinks etc. These taxes are imposed by the government
in a highly manner. Governments don’t really care about the welfare of the people. They need
more revenue and imposing high tax is the only way they can earn money. The government
knows that even if they hike the taxes on cigarettes, people would still by them because it has an
inelastic demand. This fills the government’s revenue consumption and sin taxes are favoured
the most.
In India, the government is mostly corrupt and takes all the revenue for personal use rather
than public usage. The blame is being put on the lack of education for high percentage of
smokers. The government should provide free education for less income owners which would
eventually solve the usage of cigarettes. There are more dangerous forms of tobacco worse than
cigarettes and if sin taxes are being imposed on them, it doesn’t make a difference as it is cheap
before tax itself. The government imposes sin taxes also because the country like Greece might
be facing inflation or recession issues. This could be a good reason to raise sin taxes as the
government needs more revenue to achieve normality of their respective currency which also
Bibliography:
Staff, Investopedia. "Sin Tax." Investopedia. N. p., 2006. Web. 11 Oct. 2018.
Sousa, Gregory. "Countries That Impose The Highest Taxes On Cigarettes." WorldAtlas. N. p.,
2018. Web. 11 Oct. 2018.