DUBLIN: The Irish government was warned that increasing the duty on cigarettes by 50 cent in the recent budget may not yield any extra revenue.
Revenue officials told the Department of Finance that the increasing cost of tobacco was driving more Irish smokers to buy abroad or on the black market.
The advice was in an internal pre-budget advice note for Paschal Donohoe. An official from the department’s tax division told the finance minister that Revenue had “expressed concerns that increases in excise may not lead to increased yields as consumers are further incentivised to exit the tobacco market in Ireland”.
