Ceylon Tobacco Company PLC (CTC) contribution to the government through excise, taxes and levies, has fallen to Rs 117.3 billion during the year ending December 31, 2017, compared to the Rs 135 billion targeted during the year.
The Company also notes that the dip in its contribution to the state’s coffers is the result of the legal cigarette prices shooting up by 43 per cent following the tobacco excise hike and introduction of 15 per cent VAT during the last quarter of 2016. In the past, the Government had successfully increased its excise revenue from cigarettes, on average, by around 20 per cent year on year, but in 2017 it experienced only a marginal increase of 1.6 per cent over 2016 to Rs 88.9 billion.
The Company’s volumes declined by 18 per cent when compared to 2016, while Net Turnover for the year also declined by 0.2 per cent when compared to the same period last year.
Legally manufactured cigarettes becoming unaffordable to average consumers also led to a booming illicit trade in the country. Smuggled cigarettes entering the country increased over 10-fold in 2017, with 450 million sticks infiltrating the market during the year.
0 comments: