Cigarette Prices to Fall
The five largest cigarette producers in Russia, Philip Morris, British American Tobacco, Japan Tobacco International, Gallaher Liggett-Ducat and Imperial Tobacco, have made a list of maximum retail prices for their products for this year. Those prices are 10-15 percent lower than current average prices. After the last of the cigarettes made last year are sold, sellers will have to lower their prices.
The price decrease will be most noticeable in expensive brands of cigarettes and in large cities, where cigarette prices are especially high. The price to be indicated on a pack of Marlboro, for instance, is 30 rubles (about $1.13), while it is now selling in Moscow for up to 35 rubles. Kent cigarettes will sell for 35 rubles per pack and now sell for up to 41 rubles 90 kopecks.
A new excise system for cigarettes went into effect in Russia on January 1. That fee is now tied to the maximum retail price of the cigarettes, which will be indicated on the cigarette pack. The excise fee will be 100 rubles per 1000 filter cigarettes plus 5 percent of the maximum retail price, to total not less than 115 rubles. Filterless cigarettes will be charged 45 rubles per 1000 plus 5 percent of the maximum retail price, and not less than 60 rubles. Sellers will also not be allowed to sell cigarettes for less then the maximum retail price. Cigarettes in the old packaging can be sold until January 1, 2008.
Cigarette producers will be allowed to change their maximum retail prices once a month. In Ukraine, where a similar system is in place, restaurants are excepted from maximum retail prices. Enforcement of the law is overseen by the Federal Consumers' Rights Supervisory Service (Rospotrebnadzor).
www.kommersant.com
All the Article in Russian as of Jan. 25, 2007
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