Philip Morris Japan and British American Tobacco Japan have filed applications with the ministry of finance to raise tobacco prices by JPY 20 (EUR 0.17) per pack.

If approved, the new prices are expected to take effect 1 June 2010, marking the first across-the-board hike in four years. Philip Morris Japan and BAT Japan are Number two and three in the Japanese market, with a combined share of about 35 per cent. Most cigarettes in Japan are sold 20 to a pack. Philip Morris Japan's application covers 73 products, including Marlboros, which now sell for JPY 320 (EUR 2.67). BAT Japan is looking to increase prices on 50 offerings – among them Kents, currently JPY 300 (EUR 2.50). The Japanese tobacco market has been shrinking at an annual clip of four to five per cent in recent years. Philip Morris Japan's sales volume here fell 4.7 per cent in 2009, while BAT Japan suffered a six per cent drop. Both firms say they want to raise prices to make up for lost revenues stemming from weaker sales. The Japanese government plans to hike the tobacco tax by JPY 70 (EUR 0.58) per pack in October. Japan Tobacco, the market leader, will likely increase cigarette prices by at least JPY 100 (EUR 0.83) per pack, including the tax hike, also to offset for lower sales revenue. (pi)