Excise tax: Most cigarettes in UAE market cost Dh10 or more

Dubai: Most cigarettes now cost a minimum of Dh10 per packet in the UAE, forcing smokers to shell out more money for a puff after the new excise tax came into effect from December 1.

Shopkeepers and other industry sources told Gulf News on Tuesday that prices of most of the cheap cigarettes have gone up to Dh10 and more, albeit the government setting the minimum standard price per packet at Dh8.

The Federal Tax Authority (FTA) had set a minimum of 40 fils hike in excise tax per cigarette piece while keeping the minimum standard price for a pack of 20 cigarettes at Dh8.

However, retail shops reported that most cheap cigarettes’ prices have more than doubled and they now cost more than Dh10.

Meanwhile, the brands that cost more than Dh20 have seen an increase of only Dh1, retailers said.

“Most Marlboro cigarettes had already had a 100 percent hike in prices in October 2017. Then the VAT [five per cent] also got added. Now, those cigarettes that were being sold for Dh21 have got only Dh1 hike in excise tax,” a source from the Dubai distribution company for Marlboro said.

He said the government seems to be cracking down more on cheaper cigarettes so as to safeguard a larger section of the residents from health effects of smoking.

“Prices of almost all cigarette packets with 20 pieces have gone up above Dh10,” said Thufail Kuniyil with Blue Mart Hypermarket in Al Quoz.

“The cheapest we know of is Bon International which we were selling for Dh4. Now it has become Dh8 or Dh8.50. We have not started selling it for the new price as we don’t have the stock or the new price list for it,” said Thufail.

Pine, Bon and Three Stars have been the cheap cigarettes that most workers here smoke, he said.

Expensive brands like Marlboro and Davidoff also had come up with some cheaper cigarettes after the price hike in 2017. “With the prices going up further, I think they will be in more demand now,” said Thufail.

Out of stock

Chesterfield, a cheap brand of Marlboro which now costs Dh13, was already out of stock in the store, he said.

At another supermarket in Al Quoz, a female shopkeeper who did not wish to be named said. “The cheapest cigarette we now have is John Player Gold Leaf small which we are selling for Dh6.75 for 10 pieces in a packet. But most other cigarettes have 20 pieces in a packet”

She said the cheapest packet of 20 cigarettes they have is American Blend’s Three Stars. “It was Dh5. Now it is Dh11.

Shameem, another shopkeeper with Express Al Madina Hypermarket, said customers have started buying boxes of five packets instead of 10 packets in bulk. “They have started feeling the pinch. But I don’t know for how long they will be able to control,” he said.

Farhan Mahmoud, a Pakistani accountant who is a regular smoker, said: It (The cigarette price) is too much now. But smokers will smoke at any cost. Those who are addicted cannot stop.”

Though Sunil Raj, an Indian advertising professional, also echoed the same, he said the move is likely to influence some smokers, especially workers with more financial constraints.

“I don’t plan to quit smoking. But one of my friends came from Sharjah this morning. He came to know about the new tax today only. When he heard the price, he said he was going to quit smoking.”