Friday, February 28, 2014

Tobacco products: FBR mulling over interim increase in FED

The Federal Board of Revenue (FBR) is actively pursuing a proposal to achieve federal excise duty (FED) target from cigarette industry by introducing an interim increase in excise rate on tobacco products during last quarter (April-June) 2013-14. Sources told Business Recorder here on Tuesday that the board is working out expected revenue implications of the changes in the duty structure on cigarettes in the last three months of 2013-14. In this regard, the board has also consulted two cigarette manufacturers for revision in the FED slabs of cigarettes.

When contacted, an expert said that as the FBR struggles to meet the annual tax collection target, it is also contemplating steps to enhance excise duty collection from the tobacco industry, but it is quite apprehensive as market dynamics do not support any drastic and sudden steps.

In the budget 2013-4014, a fully specific two tier duty structure was introduced by the FBR in consultation with the two large multinational cigarette manufacturers. It was expected that the steps would result into 15% increase in the excise duty revenue collection. But the figures so far show that the revenue collection in absolute Rupee terms has not touched the desired level.

Market dynamics like excessive hoarding by the traders in the previous fiscal year had a large impact on the current fiscal's sales and revenue of the tax compliant tobacco industry. In the fiscal year 2012-13 a total sale of 66.8 billion sticks helped the government mop up revenue of Rs 61.5 billion as compared to expected revenue of Rs 58.6 billion. Hoarding in April-May 2013 was prompted by strong rumours that the FBR intended to introduce a heavy excise increase, he added.

Industry sources confirmed that the excessive hoarding led to a distortion of industry projections for the current fiscal year. Continuous post-budget off-loading of stocks by the traders thus has negatively impacted industry volume and the government revenues in FY 2013-14. While introducing two tier specific excise duty structure, the FBR and the industry based its projections on market consumption and sale volume of 64 billion sticks for FY 2012-13 & 2013-14. It was understood then that a predictable duty structure would be better for the government and industry.

The current excise structure gives full control to the government as the previous excise structure depended on the manufacturers to increase prices in order for a raise in excise revenue. The new structure removes this dependence and gives the government autonomy to increase excise on its own.

A detailed analysis of the historic trends of tobacco sales and revenue also suggests that normally the first two quarters post budget witness lower volumes. These start to pick up towards the third quarter and near the budget sales jump. The new excise structure has resulted in 7.8% revenue growth during July'13-January'14, despite low volume of sales. However sales figures show that despite higher tax incidence the revenue target for excise duty collection will not be met as 2.8 billion sticks sold in the previous fiscal will lead to lower volumes for the tax complaint industry in the current year, they said.

The FBR is currently considering a proposal to achieve FED revenue targets for the cigarette industry, by introducing an interim increase in excise rate on tobacco products for the last quarter of the current fiscal year (April 2014) based on the current tax structure. This proposal may also get a positive response from the tobacco industry.  Chesterfield Bronze cigarettes.

Another market dynamic that limits FBR option is that sudden and exorbitant increases in cigarette prices that are higher than general inflation push consumers to cheaper cigarettes resulting in an increase in illicit trade. Pakistan has witnessed an increase in the consumption of illicit brands since last few years. Oxford Economic Report a study on the tobacco industry in Asia shows that currently with a market share of 25% in Pakistan, the no-duty paid segment is a serious threat to the government's objectives; reducing the incidence of smoking and increasing revenue from the industry.

Economic experts believe that expecting higher revenues from the legitimate industry, where volumes are not growing, but in fact losing to illicit trade due to lack of the government enforcement, could impact the government revenue as consumers will shift to illicit non-duty paid brands available at a fraction of a price.

Tuesday, February 11, 2014

Workers at Enfield Borough Council ordered to smoke a minimum of 25 metres away from any council building

Workers at Enfield Borough Council have been left fuming after they were ordered to smoke a minimum of 25 metres away from any council building.
An email sent to staff, seen by the Enfield Independent, states that employees can only smoke during authorised breaks.
The move is intended to ensure a smoke-free working environment, but has left a sour taste in the mouths of some staff.
One council worker, who asked to remain anonymous, said: "This is completely authoritarian by the council against those who want to smoke. I do not understand why they have decided to run with this."
Another said: "The totalitarian stance taken on this is wrong. More than 25m is quite excessive in my opinion and unfair on workers."
The email, sent to staff on January 10, reads: "The council is committed to ensuring that all our workplaces are smoke-free, and all employees and workers have a right to work in a smoke-free environment.
"All employees and workers are required to minimise the effects of their smoke on others whilst at work. Therefore, are not allowed to smoke within a minimum distance of 25m from any council building and are requested to extinguish their cigarettes and dispose of them appropriately."
The email also states that smoking is only permitted when workers are going "to and from work" and during authorised breaks.
It added: "We would like to remind all employees’ and workers that smoking is not permitted during working hours. This applies to all staff irrespective of where they work (in a council building or outdoors, or when driving a vehicle during working hours). Staff wishing to smoke can only do so on the way to and from work and during authorised breaks."
The email concludes by giving website links and phone numbers to stop smoking companies.
An Enfield Council spokesman said:  "We are absolutely committed to minimising the impact of tobacco smoke on our staff and visitors to our buildings and the communication sent to staff was designed to inform them of our policy with respect to our no smoking at work policy.
"While staff are prohibited from smoking during work hours, we do allow them to smoke, if they wish, during their authorised breaks. Our policy is proportionate, sensible and designed to protect public health."

Thursday, February 6, 2014

Cigarette Smoking Kills the Third Marlboro Man

Earlier this week it was reported that, for the third time, a Marlboro Man actor died of a smoking-related disease after spending the last years of his life speaking “out fiercely about the hazards of smoking.” There’s a biblical principle that underscores the tragic irony of these deaths, and it’s summed up in one Hebrew word.
But first, a little history.
For those not old enough to remember the Marlboro Country ads, let me describe what we saw on our TV screens day and night.
A handsome, strong cowboy—dubbed the Marlboro Man—sat on his majestic horse with an endless panorama of spacious, green fields in the background, known, quite perversely, as “Marlboro Country.” And as he sat astride his horse, he was smoking Marlboro cigarettes—for a time, the best-known product brand in the world.
The message, of course, was clear: You could live in Marlboro Country too!
You could even be like the Marlboro Man himself if you simply puffed away on these cigarettes—sitting on top of the world, the vast wilderness your playground and the cloudless sky the open roof over your home. Breathe deep and inhale the beauty of Marlboro Country!
In truth, the real Marlboro Country is the lung cancer ward in the local hospital, where a little girl watches her daddy breathe his last breath—still smoking through a hole cut in his throat.
I actually wrote about this in a 1999 book called Go and Sin No More with reference to a previous Marlboro Man who died of lung cancer. Now the tally is three actors who believed in their product so much that they endorsed it with their lives and sealed it with their deaths, seeking to warn others before it was too late.
According to a recent AP news report, “When it came to portraying the rugged western outdoorsman who helped transform a pack of filtered cigarettes into the world’s most popular brand, Marlboro Man Eric Lawson was the real deal.
“Ruggedly handsome, the actor could ride a horse through the wide-open spaces of the Southwest, from Texas to Colorado to Arizona or wherever else the Phillip Morris tobacco company sent him to light up while representing a true American icon, the cowboy. And he really did smoke Marlboro cigarettes, as many as three packs a day.
“Lawson was still smoking in 2006 when he was diagnosed with chronic obstructive pulmonary disease. He died of the disease at his home in San Luis Obispo on Jan. 10. He was 72.”
The report documents the smoking-related deaths of two other Marlboro men, “Wayne McLaren, a former rodeo rider who died in 1992 of lung cancer that he blamed on his lifelong smoking habit ... and David McLean, who died in 1995 of lung cancer that he also blamed on smoking. He was 73.”
What is the biblical principle that warns about this?
It is found in the Hebrew word acharit (pronounced a-cha-reet; the ch sounds like the Scottish ch in the word “loch”), which is related to the Hebrew word for “back.” It literally means “that which comes after; the after-effects; the final consequences; the end.” L&M Red Label
And the principle is simple: From our normal vantage point, we cannot see someone’s back. We don’t see what comes after. And so, if I tore the back of my suit jacket, leaving an ugly hole, you would never know it if you only saw me from the front. From that angle, I would look fine. But as soon as I walked past you, you would gasp.
Moments ago, everything seemed great. But when you saw my back, the whole picture changed. Instead of looking sharp, I looked sloppy.
And that’s the biblical concept: From our ordinary, human vantage point, we cannot see that which comes after—the final consequences of a matter, the acharit. We do not see our own backs.
We see the pleasure of the moment, the seductive pull of that smiling face or curvaceous body, the promise of a thrill, of satisfaction, of release.
In fact, that’s the power of advertising: Enjoy now; pay later. You want this. You need this. You can’t live without it.
To the contrary, not only can we live without so many of the things that temporarily satisfy our lusts and desires, they are often the very things that will kill us.
The man who destroyed his marriage and lost his family over an adulterous affair realizes too late that it wasn’t worth it.
The teenage girl who lost her virginity to that handsome young man—whom she’s never seen again—realizes too late that it wasn’t worth it, especially when she finds out she contracted an incurable STD.

Monday, January 20, 2014

Smoking ban burning into Gov't coffers

THE Government has acknowledged that the smoking ban introduced last July by the minister of health is having a significant negative impact on its revenue projections for the current fiscal year.
In its Fiscal Policy Paper 2013/14 Interim Report tabled in the House of Representatives late December, Minister of Finance and Planning Dr Peter Phillips pointed to a significant decline in taxes from tobacco sales as one of the primary reasons for the shortfall in tax revenues up to then.
"A significant decline in receipts from tobacco, as a result of the smoking ban in public spaces, effective July 15, 2013, also contributed to the reduction in SCT (Special Consumption Tax)," Phillips noted in the report, which is to be studied by Parliament's Public Administration and Appropriations Committee (PAAC) on Wednesday. Kiss Superslims Dream
The minister has since confirmed the report in interviews with the media but has maintained that no new taxes will be introduced to cover a widening gap in revenue projections expected to continue into 2014/15.
Phillips is also insisting that while the revenues are being impacted by the ban, the revenue targets for 2013/14 will not be changed.
He first made the statement while responding to questions from former Opposition spokesman on Finance Audley Shaw, who expressed concern in the House about the revenue loss implications for both the industry and the Government from a reduction in cigarette consumption, up to next March when the current financial year ends.
"We will continue to monitor the situation, but I want to make it absolutely clear that the revenue numbers that the government announced will remain, and that there will be no slippage in relation to overall targets for revenue," Phillips responded.
Shaw insisted then that the Government was "operating in the dark" because although the ban was imposed on cigarette consumption and not cigarette sales, it should have been obvious that sales would have been affected.
"The issue, therefore, will have to be how will that be replaced, going forward," Shaw commented.
Dr Phillips responded that, "all things being equal", there would be a reduction in consumption, but there was no indication of the pace at which the reduction would occur.
One of the areas which is being seriously affected by the reduction is the National Health Fund (NHF). Cigarette producer Carreras says that the bulk of the approximately $11 billion in taxes on cigarettes finances up to 75 per cent of the NHF's activities. However, communications director at the Ministry of Health, Neville Graham, is insisting that only 25 per cent of the NHF's budget is actually financed by cigarette tax revenue.
Graham also conceded that the smoking ban was affecting receipts from cigarette sales, but explained that when it was first raised by Carreras last year there was no evidence to support the claim.

How to Reduce Deaths From Cancer

Re “Why Everyone Seems to Have Cancer,” by George Johnson (Sunday Review, Jan. 5):
Although the “war on cancer” nowadays more resembles a siege, presuming inevitable defeat seems a bit premature. The problem — and wonder — of medicine is fundamentally Rumsfeldian: the “unknown unknowns” that limit our ability to predict both the future of disease as well as our capacity to combat it.
Centuries ago the vast army of infectious agents would have appeared similarly insurmountable — until, of course, the discovery of vaccines, antibiotics and improved public hygiene. Cancer may appear to be a more formidable opponent at present, but if history is our guide, we might be wiser to wager on human ingenuity and scientific progress to ultimately triumph over this enemy as well.
JASON P. LOTT
New Haven, Jan. 5, 2014
The writer, a doctor, is a clinical scholar in the department of dermatology, Yale University School of Medicine.
To the Editor:
Your article spotlights the inevitability of certain cancers as we age, but glosses over cancers that affect thousands of children and young people every year. As the President’s Cancer Panel noted in a 2008-2009 report, “the true burden of environmentally induced cancer has been grossly underestimated.”
Yet only a fraction of chemicals on the market have been adequately tested for safety, thanks to a dysfunctional toxics law that hasn’t been substantially updated since it was signed by President Gerald R. Ford in 1976. The good news is that lawmakers in both parties seem increasingly prepared to break the deadlock.
A bill introduced last year by Frank Lautenberg, the late Democratic senator from New Jersey, and Senator David Vitter, a Republican from Louisiana, is currently winding through the Senate, and a companion measure is expected soon on the House side. The legislation still needs work, and there are many hurdles yet to clear. But we are closer than ever to the legal safeguards that could prevent countless cancer tragedies.

Smokers more concerned with ‘effect on their looks than health’

Smokers are more concerned about the effects cigarettes have on their looks than their health, new research revealed today.
Experts found that, despite the potentially fatal long-term consequences of lighting up, a large percentage still find skin wrinkles and yellow teeth more troubling than lung damage. Dunhill Fine Cut Dark Blue
The study also found more than half of smokers either have, or are planning to, quit over fears about the damage it is doing to their appearance.
Smokers care more about the effect on their looks than health, a survey found
Smokers care more about the effect on their looks than health, a survey found (file picture)
But the in-depth findings by electronic cigarette brand VIP found one in seven admitted they would be more likely to give up the cigarettes if they noticed an effect on how they looked, rather than because their health was suffering.
And more than a quarter admitted this was the reason they have decided to quit tobacco for good.
Dave Levin, co-owner of VIP, said: ”The health effects of smoking are well documented, but people are less aware that cigarettes can also damage your looks.
”During our research three quarters of smokers said that their habit had caused deterioration to their looks and it was this, more than their health, that concerned them.
”While the health issues caused by smoking are so widely advertised, they aren’t always as easy to see or notice.
”But the effects on your appearance are something you can see every time you look at your reflection, whether it’s deeper wrinkles, discoloured teeth or a sallow complexion.”
The study, of 1,500 current or ex-smokers found that a staggering 88 per cent even admitted they regret taking it up in the first place because it is now showing in their appearance.
And the average smoker said they started to see the damage to their appearance around the age of 32.
Yellow teeth were named as the biggest concern with more than four in ten smokers saying they hated the effect cigarettes have had on their smile.
Bad breath, as well as the general odour that goes with being a smoker followed close behind, along with an increase in fine lines and wrinkles.
Stained and discoloured nails and fingers, wrinkled mouth and bad or ashen skin are also among the aspects of their appearance that smokers worry about.
Worryingly, the research also revealed that more than eight in ten admitted they are more likely to take notice of the effects of smoking they can actually see, such as yellow teeth and wrinkles, rather than what it is doing to their health and body internally.
One in three smokers has even experienced somebody insulting them or pointing out the effects of tobacco directly to their face.
And four in ten spend more time on their beauty regime to try and compensate for the effects of the cigarettes.
Dave Levin added: ”During the Christmas period Public Health England launched its latest TV advertising campaign to graphically demonstrate the health implications of tobacco.
”While we feel these messages are important and will resonate with some smokers, our research indicates that for many, vanity is also a key issue.
”VIP electronic cigarettes have been designed to offer a harm reducing alternative to smokers.
”They are not only widely recognised by a number of leading health professionals as healthier than tobacco cigarettes, but they’re also much kinder on our looks.
”Electronic cigarettes are free of the harmful toxins found in tobacco cigarettes which mean users can enjoy the great taste of VIP and stay looking good.
”What’s more, because VIP electronic cigarettes are virtually odourless and smoke free, there are no lingering tobacco smells.”

Thursday, January 16, 2014

Confusion lingers over new law on UAE shisha cafes

From February 1, cafes may not operate within 150 metres of residential areas, schools and mosques.
There are about 500 shisha cafes in the emirate including 176 in Abu Dhabi city, 178 in Mussaffah, 90 in Al Ain and 11 in Al Gharbia, and about 90 per cent of them are in densely populated areas. The rules were announced last July but owners were given a seven-month grace period to comply, move, apply for a special licence or close down. Colts Cherry
Under the new law shisha cafes must be closed beween midnight and 10am, and the area occupied by each individual smoker must be at least two square metres. They must also have a sign at the front banning customers younger than 18.
Inspectors from the Department of Economic Development will begin visits next month to ensure compliance with the new law. Owners found to have broken the law face fines of up to Dh1 million, two years in prison and closure of their businesses.
However, both owners and customers say they are unclear about whether the new law applies to them, and how it will be enforced
One owner whose cafe is near a mosque is still waiting to hear from authorities if the business will be closed or not.
The owner is worried that the cafe would not be profitable without offering shisha, and other places that met the requirements could raise their prices, to the disadvantage of customers.
“I’m leaving everything to God,” the owner said.
About 30 to 40 people visit the cafe every day for shisha. It opens from 10am to midnight and a member of staff there said it never served under-18s.
One shisha smoker, Tahron Al Fadilah, an Emirati, had mixed views on the regulations.
“It is a good thing but not by much,” said Mr Al Fadilah, 35.
“Because maybe I will have to travel outside the city and I do not want to travel outside the city to smoke a shisha. I will invite people to my home.”
Mr Al Fadilah, who has smoked the water pipe for 15 years, said he knew of several cafes that would be forced to either shut or move.
“I support this decision, I support the Government. It will be very hard on us who have to travel, but at the same time it will be very good for all the people in the area to have good, pure air to breathe.”
He felt it would be a better idea to have a similar operation to that of Saudi Arabia, where shisha cafes were clustered five to 10 kilometres out of town.
“Far away from the city — two to three miles from the city there is a big complex where all the shisha cafes are in the area. There are maybe 10 or 15 cafes in the area. It would be a good solution I think to the smoking here.”
In the dim lights of the Special 2 cafe on the Corniche, smoke billows around Hussein Mohammed, 30, and Ghassan Arman, 40, as they chat and puff on water pipes.
They have heard about the rules and are unsure if the Special will be affected.
“Every day almost I smoke shisha,” said Mr Mohammed.
“I am a regular here. This is where we go to meet friends, I do not go to the cinema or the like.”
“There are cons and advantages,” said Mr Arman.
“It is not healthy to smoke shisha but we don’t want to have to travel far for it.”
Another shisha smoker at the cafe, a Syrian, said he thought the regulations were a good move.
But he said there were some drawbacks, especially for people who don’t drink alcohol.
“You need places for rest if you’re not going to bars,” he said.