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Price of cigarette will not reduce any further

The Consumer Council of Fiji has clarified that there would be no further reduction in the current retail price of cigarette. Council CEO, Premila Kumar said the they had received calls from consumers who felt the current price was not reduced by 6% as a result of VAT reduction that came into effect on 1 January 2016. Amidst […]

Peni Shute

January 13, 2016 1:59 pm

The Consumer Council of Fiji has clarified that there would be no further reduction in the current retail price of cigarette.

Council CEO, Premila Kumar said the they had received calls from consumers who felt the current price was not reduced by 6% as a result of VAT reduction that came into effect on 1 January 2016.

Amidst growing confusion among the consumers over the price transition in the marketplace, the Council clarifies that the current retail price of the cigarette accounts for increase in excise tax (12.5%), the addition of the health levy (6%) on tobacco products and the reduction of VAT by 6 per cent. This revised retail price had come into effect on 9th November 2015.

It is understood that this move was made to avoid change of prices twice within a two month- period, to allow smooth transition to the new pricing.

Chief Executive Officer of Consumer Council of Fiji. PHOTO: FILE
Chief Executive Officer of Consumer Council of Fiji. PHOTO: FILE

Kumar said the Recommended Retail Price (RRT) was set by British American Tobacco (BAT) and all retail outlets were notified of the price change of on 9 November 2015. The cost of the VAT difference from 9 November 2015 to 31 December 2015 was borne by BAT.

Table showing the recommended retail prices of cigarettes. PHOTO: Consumer Council of Fiji
Table showing the recommended retail prices of cigarettes. PHOTO: Consumer Council of Fiji

Kumar said the VAT reduction had already been factored into the price change from 9 November 2015.

Cigarette is not a price controlled item.

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