[Intl-tobacco] Germany: Tobacco Tax Hike

[Robert Weissman]

German Government To Implement Tobacco Tax Hike In Three Steps - Dow
Jones Newswires

 Tuesday, May 27, 2003

 BERLIN -(Dow Jones)- The German government will implement its planned
EUR1 hike in tobacco tax in three steps rather than
 one, Finance Ministry spokesman Joerg Mueller said Tuesday.

 The tax increase per pack of 19 cigarettes will go towards financing
reform of the health insurance system. It will raise the price of
 a pack of cigarettes from its current EUR3.

 The hike will be introduced in three steps, starting with the first
Jan. 1, 2004, which is expected to raise EUR1 billion, Mueller
 said.

 The second and third steps are expected to raise EUR1.5 billion and
EUR2 billion, respectively. The Finance Ministry said their
 implementation dates haven't yet been decided, and nor have the amounts
of the three increases.

 However, government sources said the first step would involve an
increase of EUR0.40, followed by EUR0.30 in both steps two
 and three.

 The tobacco tax increase requires approval by both houses of
parliament, and the conservative opposition may block it in the
 upper house.

 -By Andrea Thomas, Dow Jones Newswires; 49 30 288 8410; andrea.thomas @ dowjones.com

 http://news.morningstar.com/news/DJ/M05/D27/1054038061107.html