Another tobacco tax increase in the pipeline, says finance chief

Hong Kong’s finance chief Paul Chan Mo-po said there will inevitably be another increase in tobacco tax, while pledging to strengthen efforts in cracking down on illicit cigarette activities.

His comments came after the city’s tobacco tax rose by almost 32 percent on Wednesday. The duty will go up by HK$0.8 per cigarette, with immediate effect. Last year, Chan raised the tax by HK$0.6 per cigarette.

Chan told a Legislative Council committee on Thursday that the SAR’s target is to have tobacco tax account for 75 percent of the selling price of cigarettes, with the tax rate currently at 70 percent after the recent increase.

He said the tax rate will still go up in the future.

Meanwhile, lawmaker Lai Tung-kwok, also the former Secretary for Security, questioned the law enforcement agencies' efforts in combating illicit cigarette activities.

He said the agencies have been focusing on the smuggling of illicit cigarettes while neglecting the sales of them in the city.

In response, the finance chief said he would urge relevant government departments, including customs, to step up their efforts in their enforcement work and report back to him regularly.