Belgium has ‘lost’ millions in tobacco taxes

14 May 2004

BRUSSELS – The number of cigarettes sold in Belgium has plummeted causing a major loss in revenue for the Belgian tax man, but at the same time tobacco sales in neighbouring Luxembourg have skyrocketed.

According to a report in the Friday edition of Belgium’s La Derniere Heure newspaper the Belgian government’s recent high-profile plans to crack down on smoking has backfired.

The cornerstone of the plan, unveiled at the beginning of this year, was a hefty increase in the cost of a packet of cigarettes.

But while the move seems to have hit tobacco sales in Belgium, it does not seem to have had much of an effect on the number of people in the country who smoke.

Instead, argues La Derniere Heure, more and more nicotine-addicted Belgians are crossing over the border into neighbouring Luxembourg to stock up on their weekly or monthly fixes.

To support its claim, the newspaper points to official figures that show that 501 million fewer cigarettes were sold in Belgium during the first four months of this year than during the same period in 2003.

In Luxembourg on the other hand cigarette sales have increased by 614 million over the same period.

The upshot of all of this, argues the newspaper, is that while the Belgian government has lost an estimated EUR 43.7 million in VAT receipts the number of smokers in the country has hardly changed.

[Copyright 2004]

Subject: Belgian news