Smokers provide huge revenue boost in Korea

| January 11, 2016

The government of South Korea’s predictions concerning the likely effects of its almost doubling the price of cigarettes on January 1, 2015, were off target by some way, according to a story in The Korea Herald.

It underestimated the additional tax revenue that it would receive and overestimated the fall in cigarette sales that would occur when it introduced a massive tax hike that took the retail prices of cigarettes from WON2,500 to WON4,500 a pack.

In 2015, cigarette tax revenue increased by WON3.6 trillion on that of 2014 rather than the WON2.8 trillion predicted.

At the same time, cigarette sales fell by 23.7 percent rather than the 34.0 percent predicted.

Finance Ministry officials were quoted as saying that the sales impact was reduced by a delay in implementing warning messages on cigarette packs.

Category: Breaking News

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