The Association of the Hungarian Tobacco Industry expects a 7-per-cent excise tax increase for 2008, as Hungary must comply with European Union regulations that prescribe € 64 tax per 1,000 cigarettes, President András Patai said.

Hungary's government raised the excise tax on tobacco by 2.8 per cent as of 1 April this year and will carry out another 2.8 per cent hike in September.
As of April, the specific excise tax in Hungary is HUF 7,420 per 1,000 cigarettes and there is a 27.75 per cent of TIRSP (Retail Selling Price, all Taxes Included) ad valorem excise as well. The minimum tax required is HUF 13,730 per 1,000 cigarettes. Hungary already meets the EU requirement of the total tax reaching 57 per cent of the retail price, but, according to Patai, there is a backlog in respect to the specific excise. The Hungarian state earned HUF 223 billion in excise tax on tobacco and a further HUF 67 billion in VAT in 2006 – about 2 per cent of total budget revenues.