Minister Radunović: Cheaper cigarettes and soft drinks from 1 September

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    With the new excise tobacco calendar, the excise rates are coming back to the level that has been in place since August 2017 and will remain at that level by the end of 2019, Minister of Finance Darko Radunović said following the Cabinet session. At today’s session, the Cabinet adopted the Proposal Law on Amendments to the Law on Budget and Fiscal Responsibility; Draft Law on Amendments to the Law on the Budget of Montenegro for 2018 and Proposal Law on Amendments to the Law on Excise… Minister Radunović: Cheaper cigarettes and soft drinks from 1 September

    With the new excise tobacco calendar, the excise rates are coming back to the level that has been in place since August 2017 and will remain at that level by the end of 2019, Minister of Finance Darko Radunović said following the Cabinet session. At today’s session, the Cabinet adopted the Proposal Law on Amendments to the Law on Budget and Fiscal Responsibility; Draft Law on Amendments to the Law on the Budget of Montenegro for 2018 and Proposal Law on Amendments to the Law on Excise.

    We will drop a specific excise tax on a thousand pieces from EUR 40 to EUR 30 from 1 September, which will last until the end of 2019. Proportional excise remains the same at the level of 32 percent until the end of 2019. From 1 January 2020 specific excise will increase to 33.5, while proportional excise tax will be reduced to 30.5 percent, the Minister said.

    He announced that the price of a cigarette pack would be lower by an average of 20 to 30 cents and added that excise taxes on carbonated water would be reduced from 0.3 euro per liter to 0.2 euro per liter, and then increase annually by five cents per liter.

    Minister Radunović explained that the key changes on the expenditure side of the budget are related to the strengthening of administrative capacities in the state administration, then investing in improving the quality of health care, methodological changes in budget deficit calculation, the need to increase the current budget reserve, payment of expenditures under the law in the field of social protection.

    This is the right moment to emphasise that these proposed changes are changing the structure of the budget for this year, but it is strictly taken into account to provide the same deficit ratio for 2018, i.e. we will stay at the deficit level of 3.2 percent of GDP. Original revenues are being reduced by 8.24 million, but overall expenditures are being reduced by 4, 55 million. So, the deficit is increasing by 3.7 million, i.e. 142.84 in nominal amount, i.e. 3.22, the Minister said.

    Source: Government of Montenegro