Excise doesn't cover true cost of tobacco
We refer to the article by Peter Wong, executive director of The Lion Rock Institute ('Lifestyle choices go up in smoke with tax rises', January 31).
The article has the hallmarks of the PR department of Big Tobacco. The institute claims to be an 'independent think tank'. On its website it states that it 'will accept donations from any body or person, as long as it is not from the government'. However, there is acknowledged funding from the Atlas Economic Research Foundation and International Policy Network.
A Google search for these two named organisations including the word 'tobacco' is revealing and begs the question of how 'independent' The Lion Rock Institute is.
Mr Wong stated that government tax policy on tobacco was not working because the number of smokers had increased and legitimate cigarette sales were down. The actual excise paid on cigarette sales (according to Hong Kong Customs and Excise) was - HK$3.45 billion (2007); HK$3.79 billion (2008); HK$2.88 billion (2009); HK$3.1 billion (2010). The truth is that the 50 per cent excise increase in 2009 'for health reasons' resulted in of 902.9 million fewer cigarettes being sold legally during 2009.
Mr Wong chooses to ignore the data that youth smoking has correspondingly also decreased. The figures actually show the result of the failure to increase the tobacco tax in 2010 and use retail price elasticity for the protection of young people from nicotine addiction.
Cigarettes remained too affordable and sales actually increased by 250.2 million sticks in 2010 compared with 2009.