The lower house of parliament on Tuesday approved a government proposal to raise taxes on cigarettes and tobacco products as of January 2012 and again in 2014, reports Bloomberg News.

The amended law will raise the tax on cigarettes from CZK 1.07 (EUR 0.044) to CZK 1.12 (EUR 0.046) a piece. The levy on cigars and cigarillos will increase from CZK 1.15 to CZK 1.25 a piece, while tax on tobacco will increase from CZK 1,340 to 1,400 koruna per kg.
Tobacco taxes would rise again in 2014 in order to bring them in alignment with EU legislation.
The Czech ministry of finance predicts the tax increases to generate around CZK 2.4 billion (EUR 98.6 million) in 2012, narrowing the fiscal deficit which stood at 4.8 per cent in 2010.
The amended tax law still needs to be approved by the upper house of parliament, or the Senate, and signed by President Vaclav Klaus. The lower house has the power to override eventual vetoes of the Senate and Klaus. (pi)