Tobacco industry expects declining sales

Germany’s tobacco industry expects to sell significantly fewer cigarettes by the end of this year than in 2021, reports dpa.
In the first seven months of this year, companies obtained 12.3 percent fewer tax stamps than in the same period last year, the chief executive of the industry association BVTE, Jan Mücke, told dpa at the start of the Intertabac tobacco trade fair in Dortmund. “This development is likely to continue at a slower pace until the end of the year, and there are no signs of a trend reversal.” Manufacturers receive tax stamps from the government for the sale of tobacco products, so they are an indicator of industry sales.
Mücke explains the falling demand, among other things, with the consequences of a tax increase at the turn of the year, which made cigarettes and other tobacco products more expensive. “In addition, the consumer climate has deteriorated since the start of the Ukraine war.” Because of high inflation, many people are saving and therefore buying fewer cigarettes, he said.
He also points to evasion effects. Poland, for example, has lowered taxes, which has made gasoline and diesel relatively cheap there, he said. “Many German citizens now travel to Poland to fill up and stock up on cigarettes there.” Mücke also views this critically because untaxed cigarettes are sold quite frequently in other EU countries. “The black market gets a boost from this,” he said. According to a study by the tobacco industry, about one in six cigarettes smoked in Germany is bought abroad. Half of those foreign purchases are untaxed cigarettes from the black market, he said.
Last year, spending on tobacco products in Germany was EUR 29 billion, according to figures from the Federal Statistical Office. After deducting taxes, manufacturers and retailers were left with EUR 10 billion. According to a long-standing survey conducted by Heinrich Heine University in Düsseldorf, the Debra Study, the proportion of smokers in Germany has risen by around five percentage points since the beginning of the year to 37.6 percent of young people and adults at last count. Industry representative Mücke cannot confirm this alleged trend toward smoking. “If there were more smokers, we should be able to see that in the tax statistics,” he said.

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